Chapter 22

5 GCA GOVERNMENT OPERATIONS CH. 22 GENERAL FISCAL POLICIES AND CONTROLS 1 CHAPTER 22 GENERAL FISCAL POLICIES AND CONTROLS Article 1. Funds Management. Article 2. Central Accounting. Article 3. Regulation of Federal Expenditures. Article 4. Regulation of Local Expenditures. Article 5. Interest on Late Payments by the Governm ent. Article 6. Contracts. Article 7. General Property Control. Article 8. Tax Refund Bonds. Article 9. Rainy Day Fund. Article 10. Limited Obligation Infrastructure Impro vement Bonds. Article 11. Human and Health Services Fund. Article 12. Reserve Fund for Non-participating Toba cco Manufacturers. Article 13. Securitization of Tobacco Settlement Pa yments. Article 14. Compact Impact Grant Anticipation Bonds . Article 15. Indirect Cost Fund. Article 16. Supplemental Appropriations Revenue Fu nd. Article 17. Opioid Prevention and Treatment Act. ARTICLE 1 FUNDS MANAGEMENT § 22101. Treasurer of Guam. § 22101.1. Monthly Disbursements to Public Schools System’s School District. [Repealed] § 22102. Treasurer’s Bond. § 22103. Official Title of Treasurer. § 22104. Warrants. § 22105. Claims for Loss of Government Funds. § 22106. Payment of Claims for Loss. § 22107.

ol District. [Repealed] § 22102. Treasurer’s Bond. § 22103. Official Title of Treasurer. § 22104. Warrants. § 22105. Claims for Loss of Government Funds. § 22106. Payment of Claims for Loss. § 22107. Transmittal of Claim-related Documents. § 22108. Revolving Funds. § 22109. Reports on Fund Conditions. § 22109.1. On-line Electronic Access to Bank Accoun t Information. COL4/6/20225 GCA GOVERNMENT OPERATIONS CH. 22 GENERAL FISCAL POLICIES AND CONTROLS 2 § 22110. Accounting Forms. § 22111. Direct Deposit of Judiciary Appropriations . § 22101. Treasurer of Guam. The Treasurer of Guam or his designated agent, shal l receive, and account for all monies, from whatever source, g iving proper authenticated receipts for the same. He shall disbu rse monies only upon properly signed warrants. He shall maintain a daily cash blotter in which shall be entered all cash transact ions in detail, showing dates of all receipts and disbursements, na mes or persons making payments or receiving payments and amounts. This blotter shall be balanced daily. All receipts and w arrants shall be turned over daily after recapitulation on control r ecords to the Director of Administration for audit, verification,

mounts. This blotter shall be balanced daily. All receipts and w arrants shall be turned over daily after recapitulation on control r ecords to the Director of Administration for audit, verification, necessary ledger entries, and filing. SOURCE : GC § 6100. § 22101.1. Monthly Disbursements to the Department of Education’s School Districts. [Repealed.] SOURCE : Added by P.L. 24-142:9. Repealed by P.L. 26-26:13 . § 22102. Treasurer’s Bond. Both the Treasurer and his authorized agent must b e bonded in penal sums as directed by the Governor. SOURCE : GC § 6101. § 22103. Official Title of Treasurer. The official title of the Treasurer to be affixed to his official signature shall be Treasurer of Guam. SOURCE : GC § 6102. § 22104. Warrants. All warrants must be properly authorized and signe d by the payee before acceptance by the Director of Administ ration. No warrants shall be accepted by the Director of Admin istration which are unsigned and the Treasurer shall be respo nsible for all disbursements not so authorized and signed. COL4/6/20225 GCA GOVERNMENT OPERATIONS CH. 22 GENERAL FISCAL POLICIES AND CONTROLS 3 SOURCE : GC § 6103. § 22105. Claims for Loss of Government Funds.

all disbursements not so authorized and signed. COL4/6/20225 GCA GOVERNMENT OPERATIONS CH. 22 GENERAL FISCAL POLICIES AND CONTROLS 3 SOURCE : GC § 6103. § 22105. Claims for Loss of Government Funds. Claims of officers or agents, whose duty it is to collect or account for public funds, for losses of funds in tr ansit, by fire, burglary, or other unavoidable casualty, shall be s ubmitted to the Director of Administration within fifteen days afte r such loss occurs, with all facts pertaining to the case. If t he Director of Administration shall find that the said funds were properly remitted, and that the loss resulted through no fau lt of said officer or agent, he may, under written authority of the Go vernor, credit the account of such officer or agent with the loss; provided, that in no case shall a credit in excess of Two Hundred Dollars be given in this manner. Claims for losses in excess o f Two Hundred Dollars may be submitted through the Director of Ad ministration to the Governor for relief. SOURCE : GC § 6104. § 22106. Payment of Claims for Loss. All claims arising on account of outstanding liabi lities shall be filed with the Director of Administration, with the evidence

or for relief. SOURCE : GC § 6104. § 22106. Payment of Claims for Loss. All claims arising on account of outstanding liabi lities shall be filed with the Director of Administration, with the evidence pertaining thereto. If the Director of Administrati on shall find that such claim is valid and unpaid, he shall certify th e amount due to the Governor, who may issue a warrant on said certi ficate for payment. SOURCE : GC § 6105. § 22107. Transmittal of Claim-related Documents. A true copy of all orders of the government of Gua m which may originate a claim or in any manner affect the s ettlement of any account, shall be transmitted by the proper off icer to the Director of Administration. SOURCE : GC § 6106. § 22108. Revolving Funds. (a) The Governor may, when he deems it necessary a nd proper, create, establish and continue from appropr iated funds or service fees, revolving or other special funds to b e used in providing services and in maintaining such activiti es of the COL4/6/20225 GCA GOVERNMENT OPERATIONS CH. 22 GENERAL FISCAL POLICIES AND CONTROLS 4 government of Guam as the purchase and sale of seed by the Department of Agriculture and the purchase of books by the

4/6/20225 GCA GOVERNMENT OPERATIONS CH. 22 GENERAL FISCAL POLICIES AND CONTROLS 4 government of Guam as the purchase and sale of seed by the Department of Agriculture and the purchase of books by the Department of Education. (b) Such revolving or other special funds, if and w hen created and established, shall be maintained separate and a part from any other funds of the government of Guam, and independ ent records and accounts shall be maintained in connection ther ewith as prescribed by the Director of Administration. (c) All moneys received from said activities shall be deposited in the appropriate revolving or other spe cial funds, and all debts, liabilities, obligations and operating e xpenses in connection with such activities shall be paid there from. (d) The Director of the Department or such other of ficer who has cognizance and jurisdiction over such revolving or other special funds established as provided herein, shall monthly render to the Governor a statement reflecting the financia l condition of the fund or funds under his jurisdiction. (e) The Director of Administration shall periodical ly audit the accounts and records of such revolving or other special funds and

he financia l condition of the fund or funds under his jurisdiction. (e) The Director of Administration shall periodical ly audit the accounts and records of such revolving or other special funds and render a report thereon to the Governor. SOURCE : GC § 6112. 2009 NOTE: P.L. 28-045:10 (June 6, 2005) changed the name of the Department of Education to the Guam Public School S ystem. P.L. 30- 050:2 (July 14, 2009) reverted the name of the Guam Public School System to the Department of Education. § 22109. Reports on Fund Conditions. The Director of Administration shall make a monthl y report to the Governor and the Legislature of the conditio n of, and activity within, every fund of the Government of Gu am. He shall make a monthly report to the Chairman of the Legisl ature’s committee which oversees the Tourist Attraction Fun d (TAF) of the condition of, and activity within, the TAF. He shall further make an annual report which shall be made available to the general public. SOURCE : GC § 6111.1. Amended by P.L. 23-15:5 (May 15, 199 5). COL4/6/20225 GCA GOVERNMENT OPERATIONS CH. 22 GENERAL FISCAL POLICIES AND CONTROLS 5 NOTE : GC § 6112.1, establishing an Expense & Travel Fun d, was

§ 6111.1. Amended by P.L. 23-15:5 (May 15, 199 5). COL4/6/20225 GCA GOVERNMENT OPERATIONS CH. 22 GENERAL FISCAL POLICIES AND CONTROLS 5 NOTE : GC § 6112.1, establishing an Expense & Travel Fun d, was repealed by P.L. 4-10. § 22109.1. On-line Electronic Access to Bank Accoun t Information. All banks receiving government funds for deposit in a government bank account established at said bank sh all provide 'READ ONLY' access to such bank accounts via said b ank’s on- line banking website or via electronic access via o ther access source provided to the Department of Administration , to the Office of Finance and Budget, and to the Office of Public Accountability. SOURCE : Added by P.L. 31-233:XII:39 (Sept. 7, 2012). § 22110. Accounting Forms. Such forms as may be required from time to time fo r the proper conduct of business and relating to the syst em of accounting shall be prepared under the direction of the Director of Administration, subject to the approval of the Gove rnor. SOURCE : GC § 6111. § 22111. Direct Deposit of Judiciary Appropriations . (a) With respect to the appropriations by I Liheslaturan Guåhan for the operations of the Judiciary of Guam for any fiscal year, the

: GC § 6111. § 22111. Direct Deposit of Judiciary Appropriations . (a) With respect to the appropriations by I Liheslaturan Guåhan for the operations of the Judiciary of Guam for any fiscal year, the Director of Administration shall deposit, on the last day of each month, into a bank account designated by th e Judiciary, a sum from the prior month’s General and Special Fund revenue collections as defined in Subsection (a)(1) and (2) of this Section; provided, however, that the deposits for the fiscal year shall not exceed the total amount appropriated by I Liheslaturan Guåhan for the fiscal year. (1) Deposit percentage calculation for each fiscal year shall equal the General Fund appropriation amount o f the Judiciary of Guam’s budget for the fiscal year divi ded by the total General Fund Revenue Available for Appropriat ion for the government of Guam as adopted by I Liheslaturan Guåhan in the General Appropriations Act for the same fisc al year. The term 'General Fund Revenue Available for Appropriation' as used herein shall not include rev enue for COL4/6/20225 GCA GOVERNMENT OPERATIONS CH.

eral Appropriations Act for the same fisc al year. The term 'General Fund Revenue Available for Appropriation' as used herein shall not include rev enue for COL4/6/20225 GCA GOVERNMENT OPERATIONS CH. 22 GENERAL FISCAL POLICIES AND CONTROLS 6 tax refund payments, federal sources, and the two p ercent (2%) General Fund Reserve as mandated by 5 GCA § 22 436. (2) The monthly deposit shall be based on the percentage derived from Subsection (a)(1) of this S ection multiplied by the actual cash collected by the aggr egate revenue funding sources as defined in Subsection (a ) of this Section. (b) The Chief Justice of the Judiciary of Guam shal l submit to the Speaker of I Liheslaturan Guåhan, I Maga’lahen Guåhan , and the Director of Administration, on or before Oc tober 10 of each year, a projected schedule of the monthly depo sits in accordance with Subsection (a)(2) of this Section f or the Judiciary for the fiscal year. (c) It shall be a ministerial duty of the Director of Administration to make the monthly deposits to the Judiciary of Guam as required by this Section. SOURCE : Added by P.L. 30-177:2 (July 22, 2010), effective thirty (30) days from date of enactment pursuant to P.L.

to make the monthly deposits to the Judiciary of Guam as required by this Section. SOURCE : Added by P.L. 30-177:2 (July 22, 2010), effective thirty (30) days from date of enactment pursuant to P.L. 30-177 :4. Amended by P.L. 31-077:XII:38 (Sept. 20, 2011). ---------- ARTICLE 2 CENTRAL ACCOUNTING § 22201. Title. § 22202. Director. § 22203. Duties of Director. § 22204. Rules & Regulations. § 22205. Exceptions. § 22201. Title. This Article shall be known as the Central Accounti ng Act. SOURCE : GC § 6800 added by P.L. 13-96. § 22202. Director. The Director of Administration, hereafter referred to as the Director, shall establish and administer the Centra l Accounting COL4/6/20225 GCA GOVERNMENT OPERATIONS CH. 22 GENERAL FISCAL POLICIES AND CONTROLS 7 Office of the government of Guam, which will consti tute the central accounting agency for the efficient managem ent of a system of accounts. SOURCE : GC § 6801 added by P.L. 13-96. § 22203. Duties of Director. The Director shall, with due regard for the functio n of the specific agencies concerned, organize and opera te the accounting system on a fund basis with a self-balan cing set of accounts, recording cash and/or other resources

regard for the functio n of the specific agencies concerned, organize and opera te the accounting system on a fund basis with a self-balan cing set of accounts, recording cash and/or other resources together with all related liabilities, obligations, reserves and equities which are segregated for the purpose of carrying on specific activities or attaining certain objectives; establi sh an accounting system which provides budgetary control over general governmental revenues and expenditures; det ermine fairly and with full disclosure the financial posit ion and results of financial operations; show that all appl icable legal provisions have been complied with; establish vario us types of funds as are necessary and as required by law; s hall account in the General Fund all financial transacti ons not properly accounted for in another fund; shall accou nt in the Special Revenue Funds all proceeds of specific reve nue sources or to finance specific activities as requir ed by law; shall account in the capital improvements funds all receipts and disbursements of monies used for the acquisitio n of capital facilities; shall account in other funds co nsistent with legal and operating

l account in the capital improvements funds all receipts and disbursements of monies used for the acquisitio n of capital facilities; shall account in other funds co nsistent with legal and operating requirements; classify accounts to insure compliance with budgetary provisions; provide a bas is for financial and administrative control, furnish data required for financial statements and provide a basis for co mparison with similar data for other periods, etc.; establis h standards, procedures and techniques for a central accounting system; conduct a continuing review of all accounting opera tions to effect improvements in accordance with current acco unting practices; establish standards for the preparation of financial statements and other reports as are necessary; main tain all Federal grant award funds including maintenance of COL4/6/20225 GCA GOVERNMENT OPERATIONS CH. 22 GENERAL FISCAL POLICIES AND CONTROLS 8 encumbrance and expenditure; and obtain reports fro m all departments and agencies as are required for the ef fective administration of a central accounting system; and take all actions necessary to ensure that an adequate public education is available to every public

and agencies as are required for the ef fective administration of a central accounting system; and take all actions necessary to ensure that an adequate public education is available to every public school student. SOURCE : GC § 6802 added by P.L. 13-96:1. Amended by P.L. 27-78:3. Amended by P.L. 28-045:12 (June 6, 2005), effective Oct. 1, 2005 pursuant to P.L.28-045:23. 2013 NOTE: There is manifest error in P.L. 28-045:12 (June 6, 2005); although it refers to § 20203 of this Title, the co rrect amendment is to this section. § 22204. Rules & Regulations. The Director of the Department of Administration t ogether with the Director of the Bureau of Budget and Manag ement Research, subject to the approval of the Governor o f Guam, shall prescribe rules and regulations as are necessary or proper to effectuate the purposes of this Article; provided, however, that the exercise of the rule-making authority herein grante d shall be made in accordance with the provisions of the Administra tive Adjudication Law. Unless otherwise found to be impr acticable, such rules and regulations shall provide that the p rinciples of the governmental accounting and reporting, classificati on of funds

ive Adjudication Law. Unless otherwise found to be impr acticable, such rules and regulations shall provide that the p rinciples of the governmental accounting and reporting, classificati on of funds and accounts, and accounting terminology shall conf orm to those recommended by the National Committee on Government al Accounting. SOURCE : GC § 6803 added by P.L. 13-96:1. NOTE : Reference to Territorial Auditor deleted from fir st clause because the Office of Territorial Auditor has been repealed (P.L. 17-7:1). The Office of Public Auditor has been created by P.L. 2 1-122, as 1 GCA Chapter 19. 2009 NOTE : Reference to Office of Public Auditor changed to Office of Public Accountability pursuant to P.L. 30-027:2 (Ju ne 16, 2009). § 22205. Exceptions. The provisions of this Act shall not apply to the accounting operations of the Guam Waterworks Authority, the Gu am Power Authority, the A. B. Won Pat International Airport Authority Guam, the Guam Housing and Urban Renewal Authority, the COL4/6/20225 GCA GOVERNMENT OPERATIONS CH. 22 GENERAL FISCAL POLICIES AND CONTROLS 9 Guam Housing Corporation, the Guam Economic Develop ment and Commerce Authority, the Judicial Branch, the Le

, the COL4/6/20225 GCA GOVERNMENT OPERATIONS CH. 22 GENERAL FISCAL POLICIES AND CONTROLS 9 Guam Housing Corporation, the Guam Economic Develop ment and Commerce Authority, the Judicial Branch, the Le gislative Branch, the Guam Community College, the Department of Education the University of Guam and the Guam Mass Transit Authority. SOURCE : GC § 6804 amended by P.L. 16-44, P.L. 16-56:10 an d P.L. 19- 11:10. Amended by P.L. 25-06:2. Repealed and Reena cted by P.L. 27- 110:3. 2009 NOTE: P.L. 28-045:10 (June 6, 2005) changed the name of the Department of Education to the Guam Public School S ystem. P.L. 30- 050:2 (July 14, 2009) reverted the name of the Guam Public School System to the Department of Education. NOTE : Public Law 16-63 added GC § 6806 and § 6807 relat ive to federal block grants. However, section 3 of that law automa tically terminated those two sections effective Sept. 30, 1984. Theref ore, these two sections are not included in this Code. ---------- ARTICLE 3 REGULATION OF FEDERAL EXPENDITURES § 22301. Purpose. § 22302. Definitions. § 22303. Receipt of Federal Funds. § 22304. Expenditures Restricted. § 22305. General Fund Protected. § 22306.

--- ARTICLE 3 REGULATION OF FEDERAL EXPENDITURES § 22301. Purpose. § 22302. Definitions. § 22303. Receipt of Federal Funds. § 22304. Expenditures Restricted. § 22305. General Fund Protected. § 22306. Penalty for Noncompliance. § 22301. Purpose. It is the purpose of this Article to clarify the r ole of the Guam Legislature in appropriating Federal funds received by Guam so as to assure that the purposes of the government of Guam are served and legislative priorities are adhered to by the acceptance and use of such funds. SOURCE : GC § 6800 added by P.L. 14-83:1. 2018 NOTE: References to 'Territory' removed and/or altered to 'Guam' pursuant to 1 GCA § 420. COL4/6/20225 GCA GOVERNMENT OPERATIONS CH. 22 GENERAL FISCAL POLICIES AND CONTROLS 10 COMMENT : 1. Annual Budget laws usually contain one or more provisions applicable to the use of federal funds. Therefore, please look at each year’s annual budget to see the latest provisi ons on this subject. 2. Section 1423j of Title 48, United States Code, i s paramount to local legislation [this Article] and provides that the United States Congress can make appropriations directly to the government of Guam.

ction 1423j of Title 48, United States Code, i s paramount to local legislation [this Article] and provides that the United States Congress can make appropriations directly to the government of Guam. Where these appropriations or grants completely fund a specific purpose without the need of local funding, and where the appropriation or grant does not provide for local legislative control, there is no authority for the Guam Legislature to assume the responsibility for reappr opriating these funds. Wong, Deputy Consumer Counsel v. Camina, Director, Bureau of Budget & Management Research , 2 Guam R. 132, 133 (1978). § 22302. Definitions. As used in this Article: (a) Agency means all offices, departments, boards, commissions, councils, committees, public corporati ons, or other entities of the Executive Branch, offices of the Judicial Branch and offices of the Legislative Branch of the government of Guam. (b) Agency Head means the principal officer of a department or agency. (c) Federal funds means any financial assistance ma de to an agency by the United States government, wheth er a loan, grant, subsidy, augmentation, reimbursement, or in any other form.

ent or agency. (c) Federal funds means any financial assistance ma de to an agency by the United States government, wheth er a loan, grant, subsidy, augmentation, reimbursement, or in any other form. (d) Federal program means the program or project supported in whole or in part by Federal funds. SOURCE : GC § 6801 added by P.L. 14-83. § 22303. Receipt of Federal Funds. (a) All Federal funds shall be deposited in and cr edited to the General Fund account and be available for appropria tion by the Legislature as part of the Guam’s operating budget; furthermore, detailed and accurate accounting records shall be m aintained for such Federal funds. (b) The provisions of subsection (a), above, shall not apply to those cases where by statutory enactment the Leg islature has created a special fund or restricted receipt accoun t and has COL4/6/20225 GCA GOVERNMENT OPERATIONS CH. 22 GENERAL FISCAL POLICIES AND CONTROLS 11 specifically provided thereby for an exclusive, spe cial purpose, or other use of Federal funds so long as such Federal funds are used solely and exclusively for such specific statutory purpose or purposes. SOURCE : GC § 6802 added by P.L. 14-83:1.

pe cial purpose, or other use of Federal funds so long as such Federal funds are used solely and exclusively for such specific statutory purpose or purposes. SOURCE : GC § 6802 added by P.L. 14-83:1. 2018 NOTE: References to 'Territory' removed and/or altered to 'Guam' pursuant to 1 GCA § 420. § 22304. Expenditures Restricted. (a) No department or agency may make expenditure o f any Federal funds regardless whether such funds are adv anced prior to expenditure or as reimbursement unless such expendi tures are made pursuant to specific appropriations of the Leg islature. (b) The Health Security Trust Fund, subject to legi slative approval, may be invested or reinvested in bonds or in securities that are approved for the Retirement Fund, or accor ding to modern investment practices of similar funds. The appropri ations from the Health Security Trust Fund shall be limited to fift y percent (50%) of the initial deposit from the proceeds of the sal e for the first four (4) years. Thereafter, expenditures shall be limite d to ninety percent (90%) of the earnings of the Fund. (c) If Federal funds received are greater than the amount of such funds appropriated by the Legislature for a sp

r, expenditures shall be limite d to ninety percent (90%) of the earnings of the Fund. (c) If Federal funds received are greater than the amount of such funds appropriated by the Legislature for a sp ecific purpose pursuant to this Article, the total appropriation l evel of Federal and local funds allocated for such purpose shall re main at the level designated by the Legislature. SOURCE : GC § 6803 added by P.L. 14-83:1. Subsection (b) amended by P.L. 27-69:6(b). COMMENT : See COMMENT to § 22301. Many federal grants provi de for specific ratios of local to federal funds. Othe r grants and programs provide that federal funds cannot supplant local fu nds for the project. Check with the specific grant or program for detail s. § 22305. General Fund Protected. To insure that the General Fund will not be burden ed with expenditures for Federal projects, an agency head r esponsible for administering any Federal funds shall submit to the Director of the Guam State Clearinghouse on the 30th of each month a report on COL4/6/20225 GCA GOVERNMENT OPERATIONS CH. 22 GENERAL FISCAL POLICIES AND CONTROLS 12 expenditures incurred for Federal programs for the preceding month.

nghouse on the 30th of each month a report on COL4/6/20225 GCA GOVERNMENT OPERATIONS CH. 22 GENERAL FISCAL POLICIES AND CONTROLS 12 expenditures incurred for Federal programs for the preceding month. Said report shall be certified by the agenc y head for accuracy and compliance with all applicable laws an d regulations governing administration of the programs. The form and details of this report shall be prescr ibed by the Director of the Guam State Clearinghouse. The Dire ctor of the Guam State Clearinghouse shall promptly discontinue disbursement of funds for Federal programs for nonc ompliance by agencies with these reporting and certification req uirements. SOURCE : GC § 6804 added by P.L. 14-83:1. Amended by P.L. 26-169:6. § 22306. Penalty for Noncompliance. The administration of authorized Federal programs shall be in full compliance with all applicable laws, rules and regulations governing the program. Noncompliance requirements b y officials or employees of the government of Guam shall be cau se for dismissal. Expenditure of public funds in violation of laws, rules, regulations, or guidelines established for the prog ram shall void the appropriation for the program and the

am shall be cau se for dismissal. Expenditure of public funds in violation of laws, rules, regulations, or guidelines established for the prog ram shall void the appropriation for the program and the amount ex pended in violation shall be due and payable to the governmen t of Guam by the officer or employee responsible for the act. COMMENT : GC § 6805 added by P.L. 14-83:1. NOTE : P.L. 14-83:2 repealed P.L. 13-85, which had added a predecessor article on the same subject, but placing the law in §§ 5200-5202 of the Government Code. ---------- ARTICLE 4 REGULATION OF LOCAL EXPENDITURES § 22401. Illegal Expenditures. § 22401.1. Expenditures on Alcoholic Beverages Il legal. § 22402. Emergency Expenses. § 22403. Authorization to Borrow for Agat Jr. High School. § 22404. Transfer Authority: Capital Improvements. § 22405. Transfer Authority: Judiciary. § 22406. Reversion of Appropriations. COL4/6/20225 GCA GOVERNMENT OPERATIONS CH. 22 GENERAL FISCAL POLICIES AND CONTROLS 13 § 22407. Entertainment Expenses Included in Certain Appropriations. § 22408. Charitable Donations. § 22409. Capital Improvement Highway Debt. § 22410. Revenues Pledged. § 22411. Capital Improvements Funded by § 22409.

ment Expenses Included in Certain Appropriations. § 22408. Charitable Donations. § 22409. Capital Improvement Highway Debt. § 22410. Revenues Pledged. § 22411. Capital Improvements Funded by § 22409. § 22412. Employment of Residents Required. § 22413. Line of Credit for the General Operations. § 22414. Documented Liabilities; Repayment. § 22415. Promissory Note; Issuance to Creditors. § 22416. General Obligation Bonds. § 22417. Use of Revenues, General Obligation Bonds. § 22418. Revenue from Vending Machine. § 22419. Vending Machines in Schools and Parks. § 22420. Placement of Vending Machines. § 22420.1. Policy in Favor of Healthy Food and Bev erage Products in all Vending Machines Located Within Government Facilities. § 22421. Transfer of Autonomous Agency Revenues to Autonomous Agency Collections Fund. § 22422. Infrastructure Improvement Fund. § 22423. Retirement Contributions and Personnel Ben efits Funds. § 22424. General Obligation Bond for Capitol Buildi ng. § 22425. General Obligation Bonds for Certain Capit al Projects, Including Certain Educational Facilities Projects. § 22426. Conflict of Interest. § 22427. Government of Guam Loan. § 22428. Utility Expense Fund.

eral Obligation Bonds for Certain Capit al Projects, Including Certain Educational Facilities Projects. § 22426. Conflict of Interest. § 22427. Government of Guam Loan. § 22428. Utility Expense Fund. § 22429. Authorization and Approval of Refunding B onds § 22430. Source of Payment for Government Notices/W ebsite Required. § 22431. Line of Credit. [Repealed] § 22432. Creation of Fund. § 22433. Authorization Conditioned § 22434. Expiration Date for Encumbrances. § 22435. Authorization to Issue Bonds for Certain C apital Expense Items and Capital Improvement Projects of School Facilities and for Other Purposes. COL4/6/20225 GCA GOVERNMENT OPERATIONS CH. 22 GENERAL FISCAL POLICIES AND CONTROLS 14 § 22436. General Fund Appropriations Cap. § 22437. Approval of Financial Agreements or Arrang ements. §22438. Timing of Municipal Lease Payments. § 22401. Illegal Expenditures. (a) No officer or employee of the government of Gu am, including the Governor of Guam, shall: (1) Make or authorize any expenditure from, or crea te or authorize any obligation under, any appropriatio n or fund in excess of the amount available therein, or for o ther than an authorized purpose; (2) Commence, continue,

expenditure from, or crea te or authorize any obligation under, any appropriatio n or fund in excess of the amount available therein, or for o ther than an authorized purpose; (2) Commence, continue, or proceed with any operational activity, construction, improvement, co ntract, or obligation without an appropriation or fund for the payment thereof; or after any such appropriation or fund is exhausted; (3) Involve the government of Guam in any contract or other obligation, for the payment of money for any purpose, in advance of the appropriation made for such purpo se; (4) Employ personnel or accept voluntary service ex cept as authorized by law; (5) Involve the government of Guam in any contract, or other obligation for the payment of money in suppor t of, or against the enactment of any measure pending before the Legislature. Nothing in this paragraph shall be dee med to preclude the presentation of testimony before any c ommittee of the Legislature by authorized representatives of the various departments, agencies, commissions, boards, or other political subdivisions of the government of Guam in support of, or against, the enactment of any measure pendin g before the

atives of the various departments, agencies, commissions, boards, or other political subdivisions of the government of Guam in support of, or against, the enactment of any measure pendin g before the Legislature; (6) (A) As used in this Section, the term appropria tion means the funds allocated by the Legislature which directs how the amount, manner and purpose of the funds are to be used. (B) The amount available in any appropriation shall be deemed to mean the original amount of an COL4/6/20225 GCA GOVERNMENT OPERATIONS CH. 22 GENERAL FISCAL POLICIES AND CONTROLS 15 appropriation from which any expenditure, contract, or obligation is intended to be paid, less amounts previously paid from such appropriations, less amou nts that must be paid from such appropriations for the period of the appropriation to satisfy obligations of government under contracts actually made and to be satisfied from such appropriation. (b) Nothing in subsection (a) hereof shall preclude the employment of personnel on a contract basis for a p eriod beyond the current annual appropriation, or the employment of personnel in cases of emergency involving the safety of human life or the protection of property.

onnel on a contract basis for a p eriod beyond the current annual appropriation, or the employment of personnel in cases of emergency involving the safety of human life or the protection of property. (c) Any officer or employee of the government of Gu am who shall violate subsection (a) hereof shall be subjec ted to appropriate disciplinary action by the branch of the government concerned, including removal where warranted, and any officer or employee of the government of Guam who shall knowingly and w illfully violate subsection (a) hereof shall be guilty of a misdemeanor. (d) As used herein, government of Guam includes all three branches, Executive, Legislative, and Judicial; off icer includes, but is not limited to, directors and agency heads, judges, and members and attaches of the Legislature. (e) Any violation of this Section by an officer or employee of the Executive Branch shall be reported at once to t he Governor by the head of the department or agency concerned, and the Governor shall furnish a report thereon, including the actio n taken, to the Legislature. SOURCE : GC § 6118: subsection (a)(5) added by P.L. 12-181 , amended by P.L.

ent or agency concerned, and the Governor shall furnish a report thereon, including the actio n taken, to the Legislature. SOURCE : GC § 6118: subsection (a)(5) added by P.L. 12-181 , amended by P.L. 12-184; subsection (a)(6) added by P.L. 17- 50:1. 2012 NOTE: In maintaining the general codification scheme of t he GCA the Compiler changed the hierarchy of subsections b eginning with 'Lowercase Roman Numerals' to 'Uppercase Letters' i n subsection (a)(6). § 22401.1. Expenditures on Alcoholic Beverages Ille gal. Except for Guam Visitors Bureau, the A.B. Won Pat International Airport Authority of Guam, and the Go vernor and the Lieutenant Governor, no officer, employee, or a gent of any COL4/6/20225 GCA GOVERNMENT OPERATIONS CH. 22 GENERAL FISCAL POLICIES AND CONTROLS 16 public corporation or of any branch, department, ag ency, or instrumentality of the government of Guam, includin g, but not limited to, the Guam Power Authority, the Guam Econ omic Development and Commerce Authority, the Guam Housin g Corporation, the Government of Guam Retirement Fund , the Jose D. Leon Guerrero Commercial Port, the Guam Waterwor ks Authority, the Guam Memorial Hospital Authority, an d Boards and

he Guam Housin g Corporation, the Government of Guam Retirement Fund , the Jose D. Leon Guerrero Commercial Port, the Guam Waterwor ks Authority, the Guam Memorial Hospital Authority, an d Boards and Commissions established by law or rule, shall e xpend public funds for the purchase of alcoholic beverages. SOURCE : Added by P.L. 27-152:2. Repeal and reenacted by P .L. 28- 068:IV:78 (Sept. 30, 2005). § 22402. Emergency Expenses. I Maga’lahen Guåhan [the Governor] is authorized to utilize no more than Two Hundred Fifty Thousand Dollars ($2 50,000.00) from General Fund appropriations for the Executive Branch for expenses resulting from civil defense, public safet y, or healthcare emergencies. Whenever this authorization is used, I Maga’lahen Guåhan [the Governor] shall provide a written report of t he expenditures of such funds and its source to I Liheslaturan Guåhan [the Legislature] and the Public Auditor within fi ve (5) days of such transactions. SOURCE : GC § 6113 amended by P.L. 15-75:4. Repealed by P. L. 26- 01:V:16. Added by P.L. 27-06:2. § 22403. Authorization to Borrow for Agat Jr. High School.

ithin fi ve (5) days of such transactions. SOURCE : GC § 6113 amended by P.L. 15-75:4. Repealed by P. L. 26- 01:V:16. Added by P.L. 27-06:2. § 22403. Authorization to Borrow for Agat Jr. High School. (a) The Governor may negotiate a loan of not to ex ceed Three Million Dollars from the Farmers Home Administratio n, U.S. Department of Agriculture. The term of the loan sha ll not be for more than 40 years at a rate of 5% interest per ann um. The money borrowed shall be used to complete construction of Agat Junior High School. (b) The Governor is authorized to execute any prom issory note and/or such other instrument(s) of indebtednes s which may be required by the Farmers Home Administration for purposes of obtaining the $3,000,000 loan referenced in subsect ion (a) of this Section. The Governor is also authorized to assign, pledge or grant a security interest in the real property tax revenu e payable to the government of Guam in 11 GCA § 24103 or in the fund s COL4/6/20225 GCA GOVERNMENT OPERATIONS CH. 22 GENERAL FISCAL POLICIES AND CONTROLS 17 appropriated and hereafter appropriated to Agat Jun ior High Sinking Fund, referenced in subsection (c) of this Section.

20225 GCA GOVERNMENT OPERATIONS CH. 22 GENERAL FISCAL POLICIES AND CONTROLS 17 appropriated and hereafter appropriated to Agat Jun ior High Sinking Fund, referenced in subsection (c) of this Section. The Legislature shall approve the terms of the loan by resolution prior to execution of any note or such other instrument(s ) of indebtedness. (c) There is created within the Treasury of Guam th e Agat Junior High Sinking Fund. The fund shall be used to pay the government’s annual obligation to Farmers Home Admi nistration on the loan to reconstruct Agat Junior High School and shall exist only until the principal and the interest be fully paid. The sum of $200,000 is hereby appropriated annually, until the principal and interest of the $3,000,000 loan from Farmers Home Administration be fully paid, from revenue collecte d pursuant to 11 GCA § 24103 to the Agat Junior High Sinking Fund . Such sums as are necessary to meet the annual obligation on the loan is appropriated from the Agat Junior High Sinking Fund . If the promissory note and/or such other instruments(s) of indebtedness are not secured by an assignment, pledge, or securi ty interest in the funds appropriated and hereinafter

r High Sinking Fund . If the promissory note and/or such other instruments(s) of indebtedness are not secured by an assignment, pledge, or securi ty interest in the funds appropriated and hereinafter appropriated to the Agat Junior High Sinking Fund, then at the end of each f iscal year, any balance of the Fund is reverted to the General Fund . (d) The Treasurer of Guam shall make necessary paym ents to the Farmers Home Administration in accordance wi th the terms and conditions of the instrument(s) of indebtedness from the Agat Junior High Sinking Fund. SOURCE : GC § 6113.1 added by P.L. 15-62; subsections (b), (c) and (d) amended by P.L. 15-86:2-4. § 22404. Transfer Authority: Capital Improvements. There is hereby authorized an annual appropriation , for the purpose of supplementing, by transfer, any appropri ation made for a capital improvement or other specific project, ex cluding annual operating appropriations. Such transfers may be mad e by the Governor, with the concurrence of the Committee on Rules of the Legislature, in the following cases only: (a) Where the transfer is found to be necessary to avoid waste or to avoid undue delay in completing an impr ovement or

ence of the Committee on Rules of the Legislature, in the following cases only: (a) Where the transfer is found to be necessary to avoid waste or to avoid undue delay in completing an impr ovement or project; and COL4/6/20225 GCA GOVERNMENT OPERATIONS CH. 22 GENERAL FISCAL POLICIES AND CONTROLS 18 (b) The total transfers shall in no event be more t han $5,000 or 10% of the appropriation, whichever is le ss, made for the improvement project. SOURCE : GC § 6118.1. COMMENT : The Legislature does not have the power to approv e, through action of a committee, any matter which wil l bind or govern the Executive Branch. See Attorney General Opinion PCF# 85-1031; see also INS v. Chada , 103 S.Ct. 2754 (1983). NOTE : GC § 6118.2, permitting the Executive to transfer operating funds, was repealed by P.L. 16-111:II:1, but see annual bu dget bills for this authority, if given. Also note that yearly appropri ation laws may modify, for that year, the provisions of § 22404 and § 2240 5. § 22405. Transfer Authority. Judiciary. Notwithstanding any other provision of law, the Ju dicial Council is hereby authorized to transfer up to ten percent (10%) of funds appropriated by I Liheslatura to various

sfer Authority. Judiciary. Notwithstanding any other provision of law, the Ju dicial Council is hereby authorized to transfer up to ten percent (10%) of funds appropriated by I Liheslatura to various divisions or categories within the Judicial Branch; provided, th at notice of each transfer and justification therefore are deliv ered by the end of the month in which the transfer takes place to t he Speaker of I Liheslaturan Guåhan . SOURCE : GC § 6118.3 added by P.L. 11-157 (July 18, 1972). Repealed/Reenacted by P.L. 22-41:5. Amended by P.L. 22-140:V:19 (09/29/94). Amended by P.L. 23-45:8 (10/18/95). Re pealed/Reenacted by P.L. 27-55:4. § 22406. Reversion of Appropriations. Notwithstanding any other provision of law, unless any work has commenced and ten percent (10%) of the funds ha ve been expended to accomplish the purpose of an appropriat ion for a capital improvement or a capital outlay, any such a ppropriation shall cease to be an appropriation and shall become an authorization for an appropriation on March 31, 199 9. All sums previously appropriated shall revert to the fund fr om which appropriated.

ation shall cease to be an appropriation and shall become an authorization for an appropriation on March 31, 199 9. All sums previously appropriated shall revert to the fund fr om which appropriated. The Director of Administration shall make a report in a format which shall be submitted to I Liheslaturan Guåhan on sums which have been appropriated and which shall c ontinue to be appropriated for ongoing programs within ninety (90) days after the effective date of this Section. COL4/6/20225 GCA GOVERNMENT OPERATIONS CH. 22 GENERAL FISCAL POLICIES AND CONTROLS 19 SOURCE : GC § 6010 added by P.L. 18-1:17; R/R by P.L. 19-1 9:66, effective Aug. 22, 1988. Amended by P.L. 23-45:IV:5 . Amended by P.L. 25-003:V:20. COMMENT : [1993] This section performs the same purpose as former 1 GCA § 104, repealed by P.L. 15-142:8. CROSS-REFERENCES : P.L. 27-69:4 states: Notwithstanding the general provisions of § 22406 of Title 5 of the Gua m Code Annotated, which require that unused and de-appropriated funds revert to the General Fund, or any other provision of law to the contrary , all unused funds appropriated herein shall, in all circumstances and whether in whole or in part, remain in the Guam

funds revert to the General Fund, or any other provision of law to the contrary , all unused funds appropriated herein shall, in all circumstances and whether in whole or in part, remain in the Guam Behavioral Health and Well ness Center Fund and shall be carried over into the next fiscal year and shall be expended exclusively for youth compliance monitoring and tob acco and drug prevention and education programs. 2013 NOTE: Pursuant to P.L. 32-024:2 (May 6, 2013) which rena med the Department of Mental Health and Substance Abuse (DM HSA) to the Guam Behavioral Health and Wellness Center, all ref erences to DMHSA were altered to the Guam Behavioral Health and Well ness Center. § 22407. Entertainment Expenses Included in Certai n Appropriations. Whenever the terms contingent expenses or continge nt fund are used in any appropriation act, they shall inclu de, but not be limited to, entertainment expenses for official pur poses. SOURCE : GC § 6118.4 added by P.L. 13-118:3. § 22408. Charitable Donations. The Governor is authorized to accept monetary dona tions, from any individual or organization, which shall be deposited in a separate fund by the Treasurer of Guam.

:3. § 22408. Charitable Donations. The Governor is authorized to accept monetary dona tions, from any individual or organization, which shall be deposited in a separate fund by the Treasurer of Guam. Such donati ons shall, upon authorization by the Governor, be used and exp ended in accordance with the terms and conditions upon which they were made. Nothing herein shall be construed to prevent the Governor on behalf of the government of Guam from accepting donations of property from any individual or organization. SOURCE : GC § 6119. § 22409. Capital Improvement Highway Debt. (a) The Governor of Guam is authorized to create a debt or debts of the government of Guam in aggregate princi pal amount not to exceed Thirty-five Million Dollars for the p urposes of COL4/6/20225 GCA GOVERNMENT OPERATIONS CH. 22 GENERAL FISCAL POLICIES AND CONTROLS 20 implementing capital improvement highway projects; provided, however, that the terms and conditions of the debt or debts shall be approved by the Legislature by Resolution. The s entence contained in 12 GCA § 2103(k) stating: The failure of the Legislature to adopt a resolution rejecting the ter ms and conditions of the issuance of the bonds

e Legislature by Resolution. The s entence contained in 12 GCA § 2103(k) stating: The failure of the Legislature to adopt a resolution rejecting the ter ms and conditions of the issuance of the bonds for forty-five (45) ca lendar days of the date of its submission to the Legislative Secre tary shall be concurrence to the issuance of the bonds, shall not apply to the provisions of this Section and § 22409 of this Arti cle. (b) Such debt or debts may be created by a loan or other agreement executed by the Governor containing such terms as are consistent with this Section and § 22409 of this Ar ticle or may be created by the issuance of bonds in one or more ser ies sold at such terms as are consistent with this Section and § 224 09 of this Article. (c) Any bonds authorized by this Section shall be i ssued pursuant to an indenture executed by the Governor o n behalf of the government of Guam, which indenture shall speci fy the forms, amounts, maturity dates, interest rates, interest p ayment dates, denominations, places of payment, registration prov isions, rights of exchange, redemption dates and default provision s for such bonds and shall otherwise provide for the use of pr oceeds

ent dates, denominations, places of payment, registration prov isions, rights of exchange, redemption dates and default provision s for such bonds and shall otherwise provide for the use of pr oceeds of such bonds and the security for such bonds, including th e pledge authorized by § 22409 of this Article, in a manner not inconsistent with this Section and § 22409 of this Article. (d) Any debt or debts authorized by this Section sh all constitute the valid and legally binding limited ob ligation of the government of Guam payable from and secured by a pl edge of the revenues described in § 22409 of this Article, as a mended. The validity of any such debt or debts shall not be aff ected by the validity or regularity of any proceedings for the i mplementation of capital improvement highway projects funded by t he debt or debts. SOURCE : GC § 6123 added by P.L. 17-79; amended by P.L. 18 -2:1. P.L. 15-53:4, uncodified, having the same purpose, was repealed by P.L. 17-79:1. COMMENT : The Legislature does not have the power to approv e, through a resolution, any matter which will have th e force or effect of law. COL4/6/20225 GCA GOVERNMENT OPERATIONS CH.

y P.L. 17-79:1. COMMENT : The Legislature does not have the power to approv e, through a resolution, any matter which will have th e force or effect of law. COL4/6/20225 GCA GOVERNMENT OPERATIONS CH. 22 GENERAL FISCAL POLICIES AND CONTROLS 21 See Attorney General Opinion PCF# 85-1031; see also INS v. Chada , 103 S.Ct. 2754 (1983). § 22410. Revenues Pledged. All or any part of the revenues from the taxes lev ied pursuant to Article 4, Chapter 26, 11 GCA Taxation, and from the license fees and penalties imposed pursuant to 16 GCA §§ 7 136, 7159, 7170, 7171, 3102, 7173 and 11101 may be pledged to secure the repayment of any debt or debts created under § 2240 9 of this Article. Any pledge made to secure bonds shall be s ubject to approval by the Legislature by resolution pursuant to § 22409 of this Article and shall be valid and binding from th e time the pledge is made. The revenues pledged and thereafter receiv ed by the government or any trustee, depositary or custodian shall be deposited in a separate account and shall be immedi ately subject to the lien of such pledge without any physical del ivery thereof or further act, and the lien of any such pledge shall be valid and binding

ed in a separate account and shall be immedi ately subject to the lien of such pledge without any physical del ivery thereof or further act, and the lien of any such pledge shall be valid and binding against all parties having claims of any ki nd in tort, contract or otherwise against the government, such trustee, depositary or custodian, irrespective of whether th e parties have notice thereof. The indenture by which such pledge is created need not be recorded. All such taxes, fees and penalties , to the extent so pledged, are hereby continuously appropriated for s uch purpose. All capital improvement highway projects to be fund ed from the provisions of §§ 22409 and 12410 of this Article mu st be reviewed and approved by the Governor prior to their impleme ntation. SOURCE : GC § 6124 added by P.L. 17-79; amended by P.L. 18 -2:2. § 22411. Capital Improvements Funded by § 22409. The Capital Improvement highway projects to be fun ded from the implementation of § 22409 and § 22410 of t his Article are: 85-01 Reconstruction of Route 8, Phase 1 85-02 Reconstruction of Route 1 (from Y-Sengsong Ro ad to Gayinero Road) 85-04 Interchange of Route 1 in Agana 85-05 Reconstruction of Route 2

is Article are: 85-01 Reconstruction of Route 8, Phase 1 85-02 Reconstruction of Route 1 (from Y-Sengsong Ro ad to Gayinero Road) 85-04 Interchange of Route 1 in Agana 85-05 Reconstruction of Route 2 (from Agat to Umata c) COL4/6/20225 GCA GOVERNMENT OPERATIONS CH. 22 GENERAL FISCAL POLICIES AND CONTROLS 22 85-07 Reconstruction of Route 1 (from Route 4, Agan a to Route 11 Intersection, Piti) 85-08 Reconstruction of Route 1 (From Route 11, Pit i, to Route 2A Intersection, Agat) 85-09 Extension of Chalan Kanton Tutujan in Sinajan a to Route 7, Agana Heights) SOURCE : GC § 6125 added by P.L. 17-79:3. NOTE : Please see P.L. 19-2:2, as amended by P.L. 19-17, 1 and 2, for a prioritized listing of highway projects. Same compr ises the legislative intent for expenditure of funds 'derived pursuant t o Resolution No. 75 (Highway Bonds).' § 22412. Employment of Residents Required. No contract or subcontract may be awarded to any c ontractor providing services on the capital improvement proje cts funded from the implementation of § 22409 and § 22410 of t his Article unless 75% of the persons employed by the contracto r to work on such projects are residents of the Guam.

improvement proje cts funded from the implementation of § 22409 and § 22410 of t his Article unless 75% of the persons employed by the contracto r to work on such projects are residents of the Guam. Any contra ct awarded in violation of this Section shall be null and void ab initio. No money may be drawn on for capital improvement projects fu nded from the implementation of § 22409 and § 22410 of this A rticle until the trustee, depositary or custodian of the funds c ertifies that the contract awarded is in conformity with the requirem ents of this Section. SOURCE : GC § 6126 added by P.L. 17-79:4; amended by P.L. 18-02:3. 2018 NOTE: References to 'Territory' removed and/or altered to 'Guam' pursuant to 1 GCA § 420. § 22413. Line of Credit for the General Operations. I Maga’låhen Guåhan , (the Governor) on behalf of the government of Guam, is authorized to arrange a line of credit not to exceed Twenty Million Dollars ($20,000,000) with any bank or commercial lending institution licensed on Guam for the payment of general operations of the government when the fu nding of the deposits for income tax refunds result in a shortfa ll of cash required to pay for appropriations for

licensed on Guam for the payment of general operations of the government when the fu nding of the deposits for income tax refunds result in a shortfa ll of cash required to pay for appropriations for operations i n the Annual Appropriations Act. The terms of the line of credit shall include the following: COL4/6/20225 GCA GOVERNMENT OPERATIONS CH. 22 GENERAL FISCAL POLICIES AND CONTROLS 23 (a) the line of credit shall be used by I Maga’låhen Guåhan to pay for general operations in cases where a cash shortage is eminent and a strong likelihood exists that the shortage could hamper governmental operations; (b) prepaid charges shall not be levied by the bank or trust department for opening the line of credit; (c) the interest rate shall be subject to competiti ve negotiations between I Maga’låhen Guåhan (the Governor) and the banks; such interest rate shall be computed on a monthly average and based on the actual amounts ext ended to the government; (d) interest earned by the financial institution pr oviding the proceeds for the line of credit shall be exempt from taxation by the government of Guam; (e) all terms of the line of credit agreement not specifically defined in the

ncial institution pr oviding the proceeds for the line of credit shall be exempt from taxation by the government of Guam; (e) all terms of the line of credit agreement not specifically defined in the foregoing shall be nego tiated by I Maga’låhen Guåhan [the Governor] in the best interests of the people of Guam; (f) funds necessary for such repayment of interest and principal on loans authorized by this Section of th is Article are appropriated from the General Fund and any pled ge revenues; the duration for repayment of the loan sh all be negotiated by I Maga’låhen Guåhan [the Governor] which shall not extend beyond two fiscal years; (g) funds necessary for the repayment of interest a nd principal on loans authorized by this Section and ( § 22414 of this Article are appropriated from the revenue deri ved from the tax increase contained in P.L. No. 17-4, and, t o the extent necessary, from other revenues of the government of Guam and the General Fund; any excess funds from the tax increases contained in P.L. No. 17-4 shall be used to retire said debt instruments as additional principal payme nts and for no other purposes; (h) notwithstanding the first Paragraph of this Sec tion,

creases contained in P.L. No. 17-4 shall be used to retire said debt instruments as additional principal payme nts and for no other purposes; (h) notwithstanding the first Paragraph of this Sec tion, or any other provision of law, the terms of the lin e of credit arranged by I Maga’låhen Guåhan [the Governor] as COL4/6/20225 GCA GOVERNMENT OPERATIONS CH. 22 GENERAL FISCAL POLICIES AND CONTROLS 24 provided by this Section, may permit the bank or co mmercial lending institution licensed on Guam with which suc h line of credit is arranged to grant participation in such l ine of credit, at such times and in such amounts and upon such ter ms and conditions as such bank or lending institution lice nsed in Guam shall determine, to other banks, or commercial lending institutions, including those not licensed on Guam, or to any other persons, associations, or corporations; the e xemption from taxation by the government of Guam of the inte rest derived from the line of credit shall be preserved to any such participant; such participation shall be made by pu blic offering; (i) the loan may be secured by pledge of funds or a guaranty of the government of Guam, including the r evenues derived

to any such participant; such participation shall be made by pu blic offering; (i) the loan may be secured by pledge of funds or a guaranty of the government of Guam, including the r evenues derived by the government of Guam under §30 of the Organic Act of Guam; and (j) notwithstanding any substantive or procedural provision of Chapter 6 of Title 5 of the Guam Code Annotated, the government of Guam hereby waives immunity from any suit or action in contract on the line of credit but does not waive sovereign immunity of ele cted or appointed officials and employees of the government of Guam. SOURCE : GC § 6120 15-53:1, amended by P.L. 17-4:1. Subsec tion (g) added by P.L. 17-53:22. Amended by P.L. 17-59:4. Su bsection (h) added by P.L. 17-28:8. Amended by P.L. 26-122:13, P.L. 31 -077:XII:42 (Sept. 20, 2011). NOTE : Govt. Code § 6121, imposing fiscal austerity, was passed by P.L. 17-53. By its own terms, this law expired on Septem ber 30, 1985. Even though codified, it will not be placed here as it i s no longer in force. § 22414. Documented Liabilities; Repayment. Liabilities of the government of Guam documented o n May 26, 1984 by Touche, Ross & Co.

codified, it will not be placed here as it i s no longer in force. § 22414. Documented Liabilities; Repayment. Liabilities of the government of Guam documented o n May 26, 1984 by Touche, Ross & Co. are recognized by th e Legislature, and are listed as follows: Due to GovGuam Retirement System $ 16,120,000 Tax refunds (personal income) 13,500,000 Due to various vendors 2,000,000 COL4/6/20225 GCA GOVERNMENT OPERATIONS CH. 22 GENERAL FISCAL POLICIES AND CONTROLS 25 Tax refunds, corp. carryback losses 2,500,000 Tax refunds, due to GEDA rebate program 3,000, 000 Litigation claims payable 750,000 $ 37,870,000 No payment by the government of Guam is to be made on any of the liabilities listed above after the effec tive date of this Section [June 4, 1984] except as specifically appro priated by the Legislature or as provided as follows: (a) Pursuant to § 22413 of this Article, except for subsection (a) of that Section, the Governor on beh alf of the government of Guam is authorized to borrow an amoun t not to exceed Fourteen Million Dollars. This $14,000,00 0 includes the $4,000,000 authorized to be arranged a s a line of credit subject to approval by the Legislature by Re solution

orrow an amoun t not to exceed Fourteen Million Dollars. This $14,000,00 0 includes the $4,000,000 authorized to be arranged a s a line of credit subject to approval by the Legislature by Re solution according to § 22413 of this Article (as found in P .L. 17-4) and not yet drawn down as of June 4, 1984 and an ad ditional $10,000,000. The amounts, interest rates, and matur ity date of the borrowing and renewals and replacements ther eof of the entire amount of $14,000,000 authorized to be b orrowed by this Section shall be subject to the approval of the Legislature by Resolution, with all other terms to be determined in the discretion of the Governor throug h negotiation with the lending institution or institu tions involved. This authorization to borrow additional f unds shall be utilized first to pay the amounts appropriated i n sections 6 through 20 of P.L. 17-59 and the balance to pay par t of the obligations above with the obligations listed as (1) Due to Government of Guam Retirement System, (2) Due to various vendors, and (3) Litigation claims payable to be paid on a prorated basis.

of the obligations above with the obligations listed as (1) Due to Government of Guam Retirement System, (2) Due to various vendors, and (3) Litigation claims payable to be paid on a prorated basis. (b) The expenditures of the Government of Guam for FY’85 shall be 95% of the expenditures of the Gover nment of Guam in FY’83 which is 95% of $178,000,000. The COL4/6/20225 GCA GOVERNMENT OPERATIONS CH. 22 GENERAL FISCAL POLICIES AND CONTROLS 26 money realized from the 5% reduction in expenditure s shall be used to retire the liabilities of the government listed above on a prorated basis. (c) The debt of $16,120,000 owed by the General Fun d to the Retirement Fund shall be repaid by not later than June 1, 1994 with interest at the average rate of return on investments of the Retirement Fund in the preceding fiscal year. Interest and principal shall be paid in quart erly installments commencing October 1, 1984. Interest s hall accrue from March 31, 1984. Notwithstanding other provisions of law, the Treasu rer of Guam is directed to and charged with the duties and responsibilities to insure that all principal and i nterest is paid on time preceding all other liabilities and obligation s

law, the Treasu rer of Guam is directed to and charged with the duties and responsibilities to insure that all principal and i nterest is paid on time preceding all other liabilities and obligation s of the Government of Guam other than loans authorized by t his Section and existing loans authorized by § 22413 of this Ar ticle. SOURCE : GC § 6122 added by P.L. 17-53:21; subsection (a) amended by P.L. 17-59:2; subsection (c) amended by P.L. 17-59: 3. COMMENT : See COMMENT to § 22409. § 22415. Promissory Note; Issuance to Creditors. (a) Any creditor of the government of Guam (other than a tort claimant with an unadjudicated claim) who is not pa id within thirty (30) days of filing his claim may request th at the Director of Administration issue a registered, nontransferable promissory note in the amount of his claim from the government of Guam, bearing interest at six percent (6%) per annum and maturing one year from its date of issue. Within thirty (30) da ys of the request, the Director of Administration shall either issue s aid promissory note or shall deliver to the claimant a statement t hat part or all of the claim is disputed.

thin thirty (30) da ys of the request, the Director of Administration shall either issue s aid promissory note or shall deliver to the claimant a statement t hat part or all of the claim is disputed. If only part of the claim i s disputed, a promissory note shall be issued for the undisputed portion. The Director shall, in the statement that part or all o f the claim is disputed, designate a hearing officer for a hearing pursuant to the Administrative Adjudication Law, set a hearing date not less than thirty (30) days nor more than sixty (60) days from the date of the statement, and indicate with particularity the reas ons the claim is disputed. If no such statement of disputed claim is issued within COL4/6/20225 GCA GOVERNMENT OPERATIONS CH. 22 GENERAL FISCAL POLICIES AND CONTROLS 27 thirty (30) days, the claim shall be deemed undispu ted. (b) The amount of promissory notes issued in a fis cal year pursuant to subsection (a) hereof shall not exceed two percent (2%) of the total revenues projected pursuant to Ti tle 2 Guam Code Annotated Chapter 13 for the General Fund for that fiscal year. SOURCE : GC § 6131 added by P.L. 19-10:33. Amended by P.L. 29- 019:VIII:7 (Sept. 29, 2007).

es projected pursuant to Ti tle 2 Guam Code Annotated Chapter 13 for the General Fund for that fiscal year. SOURCE : GC § 6131 added by P.L. 19-10:33. Amended by P.L. 29- 019:VIII:7 (Sept. 29, 2007). § 22416. General Obligation Bonds. (a) Authorization for issuance of General Obligati on Bonds; Terms of Bonds. For the purpose of satisfying the o bligation to the Retirement Fund from the General Fund, the Gove rnor of Guam is authorized to issue one or more series of g eneral obligation bonds of the government in an aggregate principal amount not to exceed Forty-five Million Dollars ($4 5,000,000); provided, that the bonds shall not be issued withou t any unqualified opinion of bond counsel that the intere st on the bonds would be tax-exempt. The bonds shall mature at such times not later than July 1, 1996, shall bear interest at suc h rates not exceeding ten percent (10%) per annum payable at le ast semiannually on such dates commencing not later tha n one year after the date of issuance of the bonds, shall be i n such denominations, shall be subject to redemption at su ch times and upon payment of such premium not exceeding four per cent (4%) of the principal amount thereof and

ance of the bonds, shall be i n such denominations, shall be subject to redemption at su ch times and upon payment of such premium not exceeding four per cent (4%) of the principal amount thereof and shall be sold a t public or private sale for such price not less than ninety-si x percent (96%) of the principal amount thereof plus accrued intere st, all as determined by the Governor by execution of one or m ore certificates upon or prior to the issuance of the b onds. (b) Authorization for Credit Enhancement. The Gover nor is authorized to enter into such contracts or agreemen ts with such banks, insurance companies or other financial insti tutions as he determines are necessary or desirable to improve th e security and marketability of the bonds. Such contracts or agree ments may contain an obligation to reimburse, with interest, any such banks, insurance companies or other financial institutions for advances used to pay principal of or interest on the bonds. Any such reimbursement obligation may be secured by a pledge of the full COL4/6/20225 GCA GOVERNMENT OPERATIONS CH. 22 GENERAL FISCAL POLICIES AND CONTROLS 28 faith and credit of the government of Guam and the revenues

ent obligation may be secured by a pledge of the full COL4/6/20225 GCA GOVERNMENT OPERATIONS CH. 22 GENERAL FISCAL POLICIES AND CONTROLS 28 faith and credit of the government of Guam and the revenues described in Subsection (i) of this Section. (c) Use of Proceeds from Sale of Bonds. Proceeds fr om the sale of the bonds shall be used solely to satisfy t he obligation to the Retirement Fund from the General Fund and to pa y expenses related to the authorization, sale and issuance of the bonds, including without limitation, printing costs, costs of reproducing documents, bond insurance premiums, underwriting, l egal and accounting fees and charges, fees paid to banks or other financial institutions providing credit enhancement, costs of credit ratings, fees and charges for execution, transportation and safekeeping of bonds and other costs, charges and fees in connecti on with the issuance, sale and delivery of the bonds. (d) Pledge of Full Faith and Credit; Authorization to Collect Revenues. The bonds shall constitute valid and lega lly binding general obligations of the government of Guam.

and delivery of the bonds. (d) Pledge of Full Faith and Credit; Authorization to Collect Revenues. The bonds shall constitute valid and lega lly binding general obligations of the government of Guam. The government of Guam pledges its full faith and credit for the p unctual payment of both principal and interest on the bonds. There shall be collected annually in the same manner and at the sa me time as government revenue for other purposes is collected, such sum as is required to pay the principal and interest on th e bonds. All officers charged bylaw with any duty in the collect ion of the government revenues shall do every lawful thing nec essary to collect such sum. (e) Appropriation from General Fund. There are appr opriated from the General Fund such sums as will, together w ith any pledged revenues, equal in each year the amount of money necessary to pay the principal and interest on such bonds. (f) Additional Parity Bonds. The government of Guam , after appropriate enabling legislation, may issue other g eneral obligations of the government secured on a parity w ith such bonds by the general obligation of the government. (g) Waiver of Immunity.

fter appropriate enabling legislation, may issue other g eneral obligations of the government secured on a parity w ith such bonds by the general obligation of the government. (g) Waiver of Immunity. Notwithstanding any substan tive or procedural provision of Chapter 6 of this Title, th e government of Guam waives immunity from any suit or action in con tract on such bonds. COL4/6/20225 GCA GOVERNMENT OPERATIONS CH. 22 GENERAL FISCAL POLICIES AND CONTROLS 29 (h) Certificate of Governor. The technical form and language of the bonds, including provisions for execution, e xchange, transfer, registration, paying agency, lost or muti lated bonds, negotiability, cancellation and other terms or cond itions not inconsistent with Subsection (a) of this Section sh all be as specified in a certificate of authorization approve d by the Governor, authorizing the issuance of the bonds. Th e Governor may appoint a trustee authorized to receive and hol d in trust the proceeds of the bonds and revenues related thereto, to protect the rights of bondholders and to perform such other dut ies as may be specified in the certificate.

ed to receive and hol d in trust the proceeds of the bonds and revenues related thereto, to protect the rights of bondholders and to perform such other dut ies as may be specified in the certificate. The same or another s uch certificate may also authorize persons so designated to execute , on behalf of the government of Guam, any appropriate documents r elating to the bonds and the sale of the bonds. (i) Pledge of Section 30 Revenues. All or any part of the revenues derived by the government of Guam under Se ction 30 of the Organic Act may be pledged to secure the repaym ent of the bonds. Any pledge made to secure bonds shall be mad e by the certificate of authorization delivered pursuant to Subsection (h) of this Section and shall be valid and binding from th e time the pledge is made. The revenues pledged and thereafter received by the government of Guam or by any trustee appointed pursuant to Subsection (h) of this Section. The revenues shall, upon receipt by or on behalf of the government of Guam, immediately be subject to the lien of such pledge without any physical del ivery thereof or further act, and the lien of any such pledge shall be valid and binding against all

the government of Guam, immediately be subject to the lien of such pledge without any physical del ivery thereof or further act, and the lien of any such pledge shall be valid and binding against all parties having claims of any ki nd in tort, contract or otherwise against the government of Gua m, irrespective of whether the parties have notice the reof. All such taxes, fees and penalties, to the extent so pledged , are hereby continuously appropriated for such purposes. SOURCE : GC § 6128 added by P.L. 18-41:1. § 22417. Use of Revenues, General Obligation Bonds. From the date of issuance of the first bonds autho rized by § 22416 of this Code, all revenues thereafter receive d by the government for deposit in the General Fund, other t han revenues pledged or required for the payment of principal of and interest on the bonds authorized by § 22416 of this Code, shall be paid to the COL4/6/20225 GCA GOVERNMENT OPERATIONS CH. 22 GENERAL FISCAL POLICIES AND CONTROLS 30 Retirement Fund until the payments to the Retiremen t Fund together with the proceeds, if any, of the bonds pa id to the Retire- ment Fund, satisfying the accrued obligation of the General Fund of Forty-three Million Two

the payments to the Retiremen t Fund together with the proceeds, if any, of the bonds pa id to the Retire- ment Fund, satisfying the accrued obligation of the General Fund of Forty-three Million Two Hundred Thousand Dollars ($43,200,000) to the Retirement Fund, with interest , if any, as provided by law. Thereafter, such revenues shall be available for appropriation as provided by law. SOURCE : GC § 6129 added by P.L. 18-41:2. § 22418. Revenue from Vending Machines. Except for revenues derived from the sale of goods and services purchased from vending machines and amusem ent devices, which are located on property which is wit hin the jurisdiction of the Department of Parks and Recreat ion, the University of Guam, the Guam Community College, the Guam Airport Authority and the public schools pursuant t o Chapter 1, Article 2 of this Title, all net revenues derived f rom the sale of goods and services purchased from vending machines and amusement devices, located within any facility oper ated by the government including any autonomous or semi-autonom ous government agency or any corporation which is wholl y owned by the government shall be paid into the General Fund.

ny facility oper ated by the government including any autonomous or semi-autonom ous government agency or any corporation which is wholl y owned by the government shall be paid into the General Fund. SOURCE : GC § 300 added by P.L. 13-190:1; amended by P.L. 18-003:1, 18-006:15, 18-007:5 and P.L. 19-24:1. § 22419. Vending Machines in Schools and Parks. Notwithstanding any rule, regulations or law, all net revenues derived through the sale of goods and services util izing vending machines and amusement devices, located within publ ic schools shall be used exclusively for authorized student ac tivities and all net revenues derived through the sale of goods and services utilizing vending machines and amusement devices, l ocated within the jurisdiction of the Department of Parks and Recreation shall be deposited in the Recreation Activity Revol ving Fund and expended by the Department of Parks and Recreation and all net revenues derived through the sale of goods and serv ices utilizing vending machines and amusement devices, located wit hin the University of Guam shall be budgeted and expended b y the Student Body Association as approved by the Board o f Regents COL4/6/20225 GCA

ng vending machines and amusement devices, located wit hin the University of Guam shall be budgeted and expended b y the Student Body Association as approved by the Board o f Regents COL4/6/20225 GCA GOVERNMENT OPERATIONS CH. 22 GENERAL FISCAL POLICIES AND CONTROLS 31 and within the Guam Community College shall be budg eted and expended by the Student Body Association as approve d by the Board of Trustees of Guam Community College. Nothin g in the sections of this Act shall be construed to impair t he obligation of existing contracts. SOURCE : GC § 301 added by P.L. 13-190:1; amended by P.L. 18-3:1, 18-6:15, 18-7:5, and P.L. 19-24:2. § 22420. Placement of Vending Machines. A contract for a duration not to exceed two (2) ye ars for the placement of vending machines within facilities ope rated by the Government including any autonomous or semi-autonom ous Government agency or any corporation which is wholl y owned by the Government, shall be entered into only after ad vertising for sealed annual bids in a newspaper of general circul ation within Guam fourteen (14) days prior to the formal bid ope ning and then only with the highest responsible bidder.

nly after ad vertising for sealed annual bids in a newspaper of general circul ation within Guam fourteen (14) days prior to the formal bid ope ning and then only with the highest responsible bidder. The gover ning boards of the autonomous and semi-autonomous agencies and Gov ernment- owned corporations shall adopt rules and regulation s not inconsistent herewith for the solicitation of bids. Bids for contracts for non-autonomous agencies within the Executive Br anch shall be administered by the Director of Administration i n accordance with Government bidding procedures. The procedure f or the award of bids within facilities operated by the Jud iciary or the Legislature shall be in accordance with bidding pro cedures applicable to those branches of Government, provide d that bidding and contract procedures relative to the pla cement of vending machines and amusement devices on property under the jurisdiction of the Guam Airport Authority shall be in accordance with such rules and regulations as may be from time to time adopted by the Authority. SOURCE : GC § 302 added by P.L. 13-190:1; amended by P.L. 18-3:1.

e Guam Airport Authority shall be in accordance with such rules and regulations as may be from time to time adopted by the Authority. SOURCE : GC § 302 added by P.L. 13-190:1; amended by P.L. 18-3:1. 2018 NOTE: References to 'Territory' removed and/or altered to 'Guam' pursuant to 1 GCA § 420. § 22420.1. Policy in Favor of Healthy Food and Beve rage Products in all Vending Machines Located Within Government Facilities. (a) Fifty percent (50%) of all foods and beverages offered COL4/6/20225 GCA GOVERNMENT OPERATIONS CH. 22 GENERAL FISCAL POLICIES AND CONTROLS 32 for sale in government-contracted food and beverage vending machines within all government owned or leased buil dings, facilities and/or operational spaces under the cont rol of the government shall adhere to specific guidelines promoting good nutrition and healthy environments. This mandate c overs all machines designed to dispense food and/or beverages located within government facilities, but shall not apply to the vending machines within the control of the Guam Department of Education, or other departments or agencies where a stricter nutrition policy is in place.

ernment facilities, but shall not apply to the vending machines within the control of the Guam Department of Education, or other departments or agencies where a stricter nutrition policy is in place. This Section shall also apply to mobile food service establishments, and other food and beverage vendor activities, in either temporary or permanent fixed structures, on all government property, to the extent as provided pursuant to § 2 2420.2 of this Article 4. Agency heads shall be responsible for the dissemination, implementation, and compliance with the approved po licy for all vending machines on all government property, either owned or leased, and shall include all mobile food service establishments and other food and beverage vendor activities, in e ither temporary or permanent fixed structures, situated on all gove rnment property, or that are located within its department s, premises and facilities. Failure to comply with or the violatio n of any approved provisions of this policy shall result in the immediate removal or disablement of the vending machine. (b) Development of Applicable Policy.

. Failure to comply with or the violatio n of any approved provisions of this policy shall result in the immediate removal or disablement of the vending machine. (b) Development of Applicable Policy. The Director of the Department of Administration, in conjunction with t he Department of Public Health & Social Services, shal l promulgate rules and regulations, within one hundred twenty (1 20) days of the enactment of this Section, establishing standards p ursuant to which the intent of this Section shall be implement ed. The rules and regulations shall, at a minimum, provide for th e following: (1) Nutritional Facts and Guidelines. The vending machine operator shall provide a sign in close prox imity to each and every article of food/beverage, or the sel ection button, that includes a clear and conspicuous state ment disclosing the number of calories, fat, sugar, and sodium contained in the article. COL4/6/20225 GCA GOVERNMENT OPERATIONS CH. 22 GENERAL FISCAL POLICIES AND CONTROLS 33 (2) At least fifty percent (50%) of beverages offer ed in a vending machine must contain one (1), or a combin ation, of the following: (A) water; (B) coffee or tea; (C) nonfat or reduced fat milk

33 (2) At least fifty percent (50%) of beverages offer ed in a vending machine must contain one (1), or a combin ation, of the following: (A) water; (B) coffee or tea; (C) nonfat or reduced fat milk (including soy or cow’s milk, chocolate or other flavored milk not containing more than fifteen (15) grams of added su gar per two hundred fifty (250) gram serving or three ( 3) teaspoons of sugar per one (1) cup of milk; (D) one hundred percent (100%) fruit/vegetable juice; (E) fruit-based drinks containing one hundred percent(100%) fruit juice, and no added caloric sweeteners; and (F) all other non-caloric beverages, including diet sodas. (3) At least fifty percent (50%) of the snacks/food s offered in a vending machine shall meet the followi ng criteria: (A) not more than thirty-five percent (35%) of the calories shall be from fat, with the exception of n uts and seeds; snack mixes and other foods of which nuts ar e a part must meet the thirty-five percent (35%) requirement; (B) not more than ten percent(10%) of the calories shall be from saturated fat; (C) shall not contain trans fats that are added dur ing processing (hydrogenated oils and partially hydrogenated oils); (D) not

more than ten percent(10%) of the calories shall be from saturated fat; (C) shall not contain trans fats that are added dur ing processing (hydrogenated oils and partially hydrogenated oils); (D) not more than thirty-five percent (35%) of the total weight shall be from sugar and caloric sweete ners, with the exception of fruits and vegetables that ha ve not been processed with added sweeteners or fats, and n ot COL4/6/20225 GCA GOVERNMENT OPERATIONS CH. 22 GENERAL FISCAL POLICIES AND CONTROLS 34 more than three hundred sixty (360) mg of sodium pe r serving; and (E) at least one (1) item meeting the snack criteri a in each vending machine shall also meet the FDA definition of 'Low Sodium' (c 140mg per serving). Further, the policy recommends that options within the vending machine contain items that include at least two (2) grams of dietary fiber. (4) The applicable rules and regulations establishi ng applicable nutritional standards pursuant to this S ection may be amended, as necessary, to adhere to future healt hy dietary and nutritional standards set forth by the U.S. Foo d and Drug Administration. (c) Implementation Timeline.

ursuant to this S ection may be amended, as necessary, to adhere to future healt hy dietary and nutritional standards set forth by the U.S. Foo d and Drug Administration. (c) Implementation Timeline. By January 2014, at least fifty percent (50%) of all foods and beverages offe red in government-contracted food and beverage vending mac hines within government facilities and offices shall adhere to the specific guidelines established pursuant to this Se ction. Government agencies which have existing vending mac hine contracts must ensure compliance by current vendors . (d) All rules and regulations shall be promulgated, and may be amended, pursuant to Article 3 – Rule Making Pro cedures, of Chapter 9, Division 1, Title 5, Guam Code Annotated . SOURCE: Added by P.L. 31-141:2 (Nov. 17, 2011). Subsectio n (a) amended by P.L. 32-085:4 (Nov. 27, 2013). Subsecti on (c) amended by P.L. 32-085:5 (Nov. 27, 2013). NOTE: The Government of Guam Healthy Vending Machine Pol icy Rules and Regulations were adopted by P.L. 32-085:2 (Nov. 27, 2013), and are found in Title 2, Division 4, Chapter 13 of the Gua m Administrative Rules and Regulations.

ealthy Vending Machine Pol icy Rules and Regulations were adopted by P.L. 32-085:2 (Nov. 27, 2013), and are found in Title 2, Division 4, Chapter 13 of the Gua m Administrative Rules and Regulations. The Department of Administration, in conjunction with the Department of Public Health and Social Services , shall at a minimum of every five years, review and amend these rules a nd regulations, as necessary. P.L. 32-085:3. § 22420.2. Policy in Favor of Healthy Food and Beve rage Products in all Mobile Food Service Establishments or Other Food and Beverage Vendor Activities on Government Property or within Government Facilities. COL4/6/20225 GCA GOVERNMENT OPERATIONS CH. 22 GENERAL FISCAL POLICIES AND CONTROLS 35 (a) Legislative Intent. It is the intent of I Liheslaturan Guåhan to mandate the inclusion of mobile food service establishments (also commonly referred to or known as a mobile canteen), or other food vendor activities, in eithe r temporary or permanent fixed structures, on government premises, so as to comply with the provisions of § 22420.1, to the lim ited extent provided pursuant to this Section.

dor activities, in eithe r temporary or permanent fixed structures, on government premises, so as to comply with the provisions of § 22420.1, to the lim ited extent provided pursuant to this Section. For the purpose s of this Section: (1) mobile food service establishment (also commonl y referred to or known as a mobile canteen) shall mea n any privately operated food and beverage service activi ty operated from a mobile unit wherein foods are prepa red and served. (2) food and beverage vendor activity shall mean an d include fixed structures, either permanent or tempo rary, wherein foods and beverages are prepared and served . (3) prepackaged foods or snacks, or beverage(s) sha ll mean and be inclusive of all foods not directly coo ked or prepared by the vendor, and beverages not in the or iginal containers (i.e., unopened can or sealed container) . This Section shall not apply to fresh beverages prepared on-site by the vendor; for example, but not limited to, low su gar juices or beverages made from fresh fruits and/or vegetabl es; nor shall this Section apply to manufactured foods, i.e ., those foods prepared by a duly licensed business entity w ith a valid sanitary health

r beverages made from fresh fruits and/or vegetabl es; nor shall this Section apply to manufactured foods, i.e ., those foods prepared by a duly licensed business entity w ith a valid sanitary health permit issued for purpose of author izing the preparation of food(s) which are to be served or so ld by food retailers, to include, but not be limited to, store s, canteens (mobile or fixed) or various other types of vendors . (4) The sale or distribution of any alcoholic bever age shall mean as defined pursuant to Title 11 GCA, Cha pter 3; and the sale or distribution of any tobacco product s is as defined pursuant to Subsection (g) of § 6101, Chapt er 6, Title 11 GCA, which reads, '‘Tobacco product’ means any tobacco cigarette, cigar, pipe tobacco, smokeless t obacco, chewing tobacco or any other form of tobacco which may be utilized for smoking, chewing, inhalation or other means of ingestion,’' and shall include, as further provided pursuant to COL4/6/20225 GCA GOVERNMENT OPERATIONS CH. 22 GENERAL FISCAL POLICIES AND CONTROLS 36 Title 10 GCA, Chapter 90A - Importation and Sale of Ingestible Tobacco, and shall be prohibited.

ided pursuant to COL4/6/20225 GCA GOVERNMENT OPERATIONS CH. 22 GENERAL FISCAL POLICIES AND CONTROLS 36 Title 10 GCA, Chapter 90A - Importation and Sale of Ingestible Tobacco, and shall be prohibited. (b) This Section shall not apply to temporary, shor t-term food and beverage vendor activities utilizing eithe r mobile or fixed structures, and which are licensed or permitt ed to operate during special events hosted or sponsored by a muni cipal planning council, government of Guam entity, or authorized n on-profit organization for village or island events. (c) Development of Applicable Policy. The Director of the Department of Administration, in conjunction with t he Department of Public Health & Social Services, shal l promulgate the amendment of the policy established pursuant to § 22420.1 of this Article, and codified under Chapter 13 of Divi sion 4, Title 2, Guam Administrative Rules and Regulations, within o ne hundred twenty (120) days of the enactment of this Section, so as to include all mobile food service establishments (also common ly referred to or known as mobile canteens), or other food and bev erage vendor activities, in either temporary or permanent fixed structures,

lude all mobile food service establishments (also common ly referred to or known as mobile canteens), or other food and bev erage vendor activities, in either temporary or permanent fixed structures, to the extent provided pursuant to this Section. (1) The applicable rules and regulations establishi ng applicable nutritional standards pursuant to this S ection shall be promulgated and amended, as necessary, and shall adhere to future healthy dietary and nutritional standards set forth by the U.S. Food and Drug Administration, as provided pursuant to § 22420.1 of this Article 4. (d) Implementation Timeline. This Section shall be effective on January 2014, or upon the amendment an d promulgation of policy relative to this Section, as provided pursuant to Subsection (c), whichever is later. Government agencies which have existing authorized or permitted food and beverage vendor agreements or co ntracts must ensure compliance with this Section by current vend ors. (e) The amendment of any policy, rules and regulati ons, as provided pursuant to §§ 22420.1 and 22420.2 of this Article 4, and codified under Chapter 13 of Division 4, Title 2, Guam Administrative Rules and Regulations shall

policy, rules and regulati ons, as provided pursuant to §§ 22420.1 and 22420.2 of this Article 4, and codified under Chapter 13 of Division 4, Title 2, Guam Administrative Rules and Regulations shall be promu lgated, and COL4/6/20225 GCA GOVERNMENT OPERATIONS CH. 22 GENERAL FISCAL POLICIES AND CONTROLS 37 may be amended, pursuant to Article 3 - Rule Making Procedures, of Chapter 9, Division 1, Title 5, Guam Code Annota ted. SOURCE: Added by P.L. 32-085:6 (Nov. 27, 2013). § 22421. Transfer of Autonomous Agency Revenues to Autonomous Agency Collections Fund. (a) It is I Liheslatura’s (the Legislature’s) findings that for the risk assumed by Guam’s taxpayers in operating t he power, water, sewer, and air and sea port operations, a fu nd transfer policy should be instituted as a General Fund reimb ursement. It is furthermore found that these non-tax paying utiliti es benefit from services provided by the General Fund, such as poli ce and fire protection, road systems and other governmental fac ilities. In many cases, several of the services require additio nal General Fund expenditures. Further, rather than assess the actual levy of real estate taxes, as if they were of a private ven

l fac ilities. In many cases, several of the services require additio nal General Fund expenditures. Further, rather than assess the actual levy of real estate taxes, as if they were of a private ven ture which is commonly called payment-in-lieu-of-taxes, a transfe r policy would be more equitable and fair. (b) Notwithstanding any other provision of law, I Maga’lahi (the Governor) and the Boards of Directors of the J ose D. Leon Guerrero Commercial Port of Guam, the Guam Power Au thority, and the A. B. Won Pat International Airport Authori ty Guam shall transfer in the aggregate the sum of Three Million Five Hundred Thousand Dollars ($3,500,000.00) from operating sur pluses generated by these agencies to the General Fund of the government of Guam by the end of each fiscal year. The proportionate contribution of each of the above age ncies which will in the aggregate make up the Three Million Fiv e Hundred Thousand Dollars ($3,500,000.00) transferred shall be determined by a formula decided upon by I Maga’lahi (the Governor) in consultation with the Boards of Directors of the ab ove agencies.

e Hundred Thousand Dollars ($3,500,000.00) transferred shall be determined by a formula decided upon by I Maga’lahi (the Governor) in consultation with the Boards of Directors of the ab ove agencies. In no event shall the formula decided upon or the t ransfer of sums from the agencies to the General Fund violate the t erms and conditions of any bond covenant of any of the above agencies that is in effect on the effective date of this Section. SOURCE : GC § 6127 added by P.L. 18-15:X:44. Amended by P. L. 24- 14:3. Subsection (b) Repealed/Reenacted by P.L. 24- 34:2. Repealed and Reenacted by P.L. 24-59:III:23. Repealed and Reena cted by P.L. 27- 110:4. COL4/6/20225 GCA GOVERNMENT OPERATIONS CH. 22 GENERAL FISCAL POLICIES AND CONTROLS 38 § 22422. Infrastructure Improvement Fund. (a) There is created a fund known as the Infrastru cture Improvement Fund which shall be accounted for separ ate and apart from the General Fund and into which shall be deposited such revenues as set forth in 11 GCA § 30108, Finan ce and Taxation. The fund shall be appropriated to improve and develop the general infrastructure of Guam including sewer and water systems, and primary and secondary roadways

n 11 GCA § 30108, Finan ce and Taxation. The fund shall be appropriated to improve and develop the general infrastructure of Guam including sewer and water systems, and primary and secondary roadways includi ng village streets. No further appropriation shall be made of moneys in this Fund which have been pledged for the repaying of an y debts and such moneys maybe used for such pledge without furt her appropriation. (b) Notwithstanding any other provision of the law, the Infrastructure Improvement Fund shall be under the legislative purview of the legislative committee having oversig ht over the Tourist Attraction Fund. SOURCE : Enacted by P.L. 19-5:142 as GC § 10002; amended b y P.L. 19- 18:2. 2018 NOTE: References to 'Territory' removed and/or altered to 'Guam' pursuant to 1 GCA § 420. 2013 NOTE: Subsection designations were added to adhere to t he Compiler’s alpha-numeric scheme in accordance to 1 GCA § 1606. § 22423. Retirement Contributions and Personnel Ben efits Funds. (a) Legislative Intent. The Legislature finds that amounts appropriated directly to Guam agencies for retireme nt benefits, and personnel benefits such as health insurance, li fe insurance, and dental

a) Legislative Intent. The Legislature finds that amounts appropriated directly to Guam agencies for retireme nt benefits, and personnel benefits such as health insurance, li fe insurance, and dental insurance, are utilized for personnel ex penses such as overtime pay, hazardous pay, holiday pay, limited t erm positions, and other categories if the funds are transferred, so that the actual expenses of the government of Guam for retirement, health insurance, life insurance, dental insurance, overti me, limited term positions, and other categories, is obscured in the budget process since the categories for which funds are appropriat ed are actually utilized for a different purpose than that which is stated. For this reason, two funds which are separate and distinct f rom any other COL4/6/20225 GCA GOVERNMENT OPERATIONS CH. 22 GENERAL FISCAL POLICIES AND CONTROLS 39 funds of the government of Guam shall be utilized t o better track the expenses of the government of Guam in these cat egories. (b) Creation and Operation of Retirement Contributi ons Fund. There is created, separate and apart from any other funds of the government of Guam, and under the administratio n and control of the

es. (b) Creation and Operation of Retirement Contributi ons Fund. There is created, separate and apart from any other funds of the government of Guam, and under the administratio n and control of the Department of Administration, the Re tirement Contributions Fund. Notwithstanding any other provi sion of law, each fiscal year, all appropriations from the Gener al Fund to any Guam agency for the purpose of paying retirement co ntributions shall be deposited in the Retirement Contributions Fund, and shall be paid out incrementally only as required by the a ctual expenses of the aggregate of the individual employees of the government who are currently employed at the time each payroll is prepared. A report of the status of the Retirement Contributi ons Fund shall be made to the Governor and to the Legislature at t he end of each quarter. The funds in the Retirement Contributions Fund shall not be used for any other purpose than retirement contr ibutions to be transmitted to the Government of Guam Retirement Fu nd. Within thirty (30 days after the end of each fiscal year, all funds in the Retirement Contributions Fund shall be paid over to the Government of Guam Retirement Fund to

ment of Guam Retirement Fu nd. Within thirty (30 days after the end of each fiscal year, all funds in the Retirement Contributions Fund shall be paid over to the Government of Guam Retirement Fund to reduce the un funded liability. A report of this transaction shall be ma de to the Legislature. (c) Creation and Operation of Personnel Benefits Fu nd. There is created, separate and apart from any other funds of the government of Guam, and under the administration an d control of the Department of Administration, the Personnel Ben efits Fund. Notwithstanding any other provision of law, each fi scal year, all appropriations from the General Fund to any Guam ag ency for the purpose of paying medical insurance, life insurance , and dental insurance, shall be deposited in the Personnel Bene fits Fund, and shall be paid out incrementally only as required by the actual expenses of the aggregate of the individual employe es of the government who are currently employed at the time e ach payroll is prepared. A report of the status of the Personne l Benefits Fund shall be made to the Governor and to the Legislatur e at the end of each quarter.

are currently employed at the time e ach payroll is prepared. A report of the status of the Personne l Benefits Fund shall be made to the Governor and to the Legislatur e at the end of each quarter. The funds in the Personnel Benefits F und shall not be used for any other purpose than for medical insu rance, life insurance, and dental insurance. Within thirty (30 days after the COL4/6/20225 GCA GOVERNMENT OPERATIONS CH. 22 GENERAL FISCAL POLICIES AND CONTROLS 40 end of each fiscal year, all funds in the Personnel Benefits Fund shall be paid over to the Government of Guam Retire ment Fund to reduce the unfunded liability. A report of this transaction shall be made to the Legislature. SOURCE : Added by P.L. 21-136:IV:5. 2018 NOTE: References to 'Territory' removed and/or altered to 'Guam' pursuant to 1 GCA § 420. § 22424. General Obligation Bond for Capitol Buildi ng. (a) Authorization of Issuance of General Obligatio n Bonds for Capitol Building. The Governor of Guam may be a uthorized to issue one (1) or more series of general obligati on bonds of the government of Guam in an aggregate principal amount not to exceed Thirty Six Million Dollars ($36,000,000) to undertake the

horized to issue one (1) or more series of general obligati on bonds of the government of Guam in an aggregate principal amount not to exceed Thirty Six Million Dollars ($36,000,000) to undertake the construction of a capitol building and paying expen ses incurred in connection with the issuance of such bonds; provide d, however, that the issuance of the bonds shall not cause a vi olation of the debt limitation provisions of 48 U.S.C. § 1423a (§ 11 of the Organic Act of Guam.) (b) Terms and Conditions Determined by Certificate. The terms and conditions of the bonds shall be as deter mined by the Governor by the execution of a certificate authoriz ing the issuance of the bonds upon or prior to the issuance of the b onds; provided, however, that such terms and conditions shall be co nsistent with this Section, and that the bonds shall mature not l ater than December 1, 2024, and shall bear interest at such r ates and be sold for such price or prices as shall result in a yield to the bondholders not exceeding ten percent (10%) per annum. The cert ificate of the Governor shall designate the amount of each maturit y of bonds issued for construction of the capitol building but shall

bondholders not exceeding ten percent (10%) per annum. The cert ificate of the Governor shall designate the amount of each maturit y of bonds issued for construction of the capitol building but shall also permit reallocation and redesignation of such bonds. (c) Valid and Binding General Obligation. Any bonds autho- rized by this Section shall constitute the valid an d binding general obligations of the government of Guam. The governme nt of Guam pledges its full faith and credit for the punctual payment of both principal of interest on the bonds. There shall be collected annually in the same manner and at the same time as government revenue for other purposes is collected, such sum a s is required to COL4/6/20225 GCA GOVERNMENT OPERATIONS CH. 22 GENERAL FISCAL POLICIES AND CONTROLS 41 pay the principal of and interest on the bonds. All officers charged by law with any duty in the collection of the reven ues of the government shall do every lawful thing necessary to collect such sum. The validity of any such bonds shall not be af fected by the validity or regularity of any proceedings for the i mplementation of the capital project funded by the bonds.

cessary to collect such sum. The validity of any such bonds shall not be af fected by the validity or regularity of any proceedings for the i mplementation of the capital project funded by the bonds. (d) Appropriations from the General Fund. There may be authorized to be appropriated from the General Fund such sums as will equal in each year the amount of money nece ssary to pay the principal and interest on such bonds. (e) Additional Parity Bonds. Nothing in this Sectio n shall be construed to prevent the government of Guam from is suing, after appropriate enabling legislation, other obligations of the government secured by the general obligation of the government on a parity with the bonds authorized by this Secti on. (f) Waiver of Immunity. Notwithstanding any substan tive or procedural provision of Chapter 6 of Title 5, Guam Code Annotated, the government of Guam waives immunity f rom any suit or action in contract on the bonds, but does n ot waive sovereign immunity as to the personal liability of elected officials and employees of the government of Guam. (g) Form of Bonds; Covenants; Appointment of Fiduci aries.

the bonds, but does n ot waive sovereign immunity as to the personal liability of elected officials and employees of the government of Guam. (g) Form of Bonds; Covenants; Appointment of Fiduci aries. The technical form and language of the bonds, inclu ding provisions for execution, exchange, transfer, regis tration, paying agency, lost or mutilated bonds, negotiability, can cellation and other terms or conditions not inconsistent with thi s Section, including covenants relating to the collection of r evenues, shall be as specified in the certificate executed by the Gov ernor authorizing the issuance of the bonds. The certific ate may appoint one (1) or more trustees, co-trustees or other fidu ciaries authorized to receive and hold in trust the proceeds of the bo nds and monies relating thereto, to protect the rights of bondhold ers and to perform such other duties as may be specified in th e certificate. The Governor is also authorized to execute, on beha lf of the government of Guam, any appropriate agreements, cer tificates or other instruments relating to the bonds and the sal e of the bonds. COL4/6/20225 GCA GOVERNMENT OPERATIONS CH.

cute, on beha lf of the government of Guam, any appropriate agreements, cer tificates or other instruments relating to the bonds and the sal e of the bonds. COL4/6/20225 GCA GOVERNMENT OPERATIONS CH. 22 GENERAL FISCAL POLICIES AND CONTROLS 42 (h) Authorization for Credit Enhancement. The Gover nor may be authorized to enter into such contracts or a greements with such banks, insurance companies or other financial institutions as he determines are necessary or desirable to improve the security and marketability of the bonds issued under this Se ction. Such contracts or agreements may contain an obligation t o reimburse, with interest, any such banks, insurance companies or other financial institutions for advances used to pay pri ncipal of or interest on the bonds. Any such reimbursement oblig ation shall be a general obligation of the government of Guam, and any such advance, if necessary, shall be treated as creating a reimbursement obligation issued to refund the bonds. (i) Use of Proceeds from the Sale of the Bonds. Pro ceeds from the sale of the bonds may be used solely to co nstruct and equip a capitol building, to establish necessary re serves, and to pay expenses relating

Proceeds from the Sale of the Bonds. Pro ceeds from the sale of the bonds may be used solely to co nstruct and equip a capitol building, to establish necessary re serves, and to pay expenses relating to the authorization, sale an d issuance of the bonds, including, without limitation, printing cost s, costs of reproducing documents, bonds insurance premiums, underwriting, legal and accounting fees and charges , fees paid to banks or other financial institutions providing cre dit enhancement, costs of credit ratings, fees and charges for execu tion, transportation and safekeeping of bonds and other c osts, charges and fees in connection with the issuance, sale and delivery of the bonds. (j) No Personal Liability. No employee or elected o fficial of the government of Guam shall be individually or per sonally liable for the payment of any amounts due on any bonds iss ued under this Section, or for any other liability arising in connection with the bonds; provided, however, that nothing in this Section shall relieve any employee or elected official from the p erformance of any ministerial duty required by law. (k) Legislative Approval.

with the bonds; provided, however, that nothing in this Section shall relieve any employee or elected official from the p erformance of any ministerial duty required by law. (k) Legislative Approval. No bonds may be issued un der this Section without specific prior approval of the Legi slature. SOURCE : Added as § 22431 by P.L. 22-024:8 (8/31/93). NOTE : Section 9 of P.L. 22-024 gives the following impl ementation provisions: Section 8 [§ 22424] of this Act shall take effect u pon completion of the triennial property tax valuation now COL4/6/20225 GCA GOVERNMENT OPERATIONS CH. 22 GENERAL FISCAL POLICIES AND CONTROLS 43 underway and a determination that the debt capacity of the government of Guam as limited under Section 11 of t he Organic Act of Guam has increased by enough to allo w issuance of the bonds for the Northern High School prior to issuance of the bonds for the capitol building. § 22425. General Obligation Bonds for Certain Capit al Projects, Including Certain Educational Facilities Projects, and for Certain General Fund Expenses. (a) Authorization of Issuance of General Obligatio n Bonds for Capital Projects and General Fund Expenses.

s, Including Certain Educational Facilities Projects, and for Certain General Fund Expenses. (a) Authorization of Issuance of General Obligatio n Bonds for Capital Projects and General Fund Expenses. The Governor of Guam is authorized to issue two (2) or more series of general obligation bonds of the government of Guam in an ag gregate principal amount not to exceed Two Hundred Ninety-S ix Million Dollars ($296,000,000) to undertake the capital pro jects enumerated in subsection (m) of this Section, to pr ovide for the payment of the general fund expenses listed in subs ection (m) of this section and to pay expenses incurred in connec tion with the issuance of such bonds; provided, however, that the issuance of the bonds shall not cause a violation of the debt l imitation provisions of 48 U.S.C. 1423a (§ 11 of the Organic Act of Guam). (b) Terms and Conditions Determined by Certificate. The terms and conditions of the bonds shall be as deter mined by the Governor by the execution of a certificate authoriz ing the issuance of the bonds upon or prior to the issuance of the b onds; provided, however, that such terms and conditions shall be co nsistent with this Section, and that the

certificate authoriz ing the issuance of the bonds upon or prior to the issuance of the b onds; provided, however, that such terms and conditions shall be co nsistent with this Section, and that the bonds shall mature not l ater than December 1, 2023 and shall bear interest at such ra tes and be sold for such price or prices as shall result in a yield to the bondholders not exceeding eight percent 8% per annum. The certi ficate of the Governor shall separately designate the amount of e ach maturity of bonds issued for each of the capital projects en umerated in subsection (m) of this Section and for general fund expenses, but shall also permit reallocation and redesignation of such bonds, with approval from the Legislature. (c) Valid and Binding General Obligation. Any bonds autho- rized by this Section shall constitute the valid an d binding general obligations of the government of Guam. The governme nt of Guam pledges its full faith and credit for the punctual payment of both principal of and interest on the bonds. There shall be collected COL4/6/20225 GCA GOVERNMENT OPERATIONS CH.

The governme nt of Guam pledges its full faith and credit for the punctual payment of both principal of and interest on the bonds. There shall be collected COL4/6/20225 GCA GOVERNMENT OPERATIONS CH. 22 GENERAL FISCAL POLICIES AND CONTROLS 44 annually in the same manner and at the same time as government revenue for other purposes is collected, such sum a s is required to pay the principal of and interest on the bonds. All officers charged by law with any duty in the collection of the reven ues of the government shall do every lawful thing necessary to collect such sum. The validity of any such bonds shall not be af fected by the validity or regularity of any proceedings for the i mplementation of the capital projects funded by the bonds or for the payment of the general fund expenses funded by the bonds. (d) Appropriations from the General Fund. There are hereby appropriated from the General Fund such sums as wil l equal in each year the amount of money necessary to pay the principal and interest on such bonds. (e) Additional Parity Bonds. Nothing in this Sectio n shall be construed to prevent the government of Guam from is suing, after appropriate enabling legislation, other

pal and interest on such bonds. (e) Additional Parity Bonds. Nothing in this Sectio n shall be construed to prevent the government of Guam from is suing, after appropriate enabling legislation, other obligations of the government secured by the general obligation of the government on a parity with the bonds authorized by this Secti on. (f) Waiver of Immunity. Notwithstanding any substan tive or procedural provision of Chapter 6 of Title 5, Guam Code Annotated, the government of Guam waives immunity f rom any suit or action in contract on the bonds, but does n ot waive sovereign immunity as to the personal liability of elected officials and employees of the government of Guam. (g) Form of Bonds; Covenants; Appointment of Fiduci aries. The technical form and language of the bonds, inclu ding provisions for execution, exchange, transfer, regis tration, paying agency, lost or mutilated bonds, negotiability, can cellation and other terms or conditions not inconsistent with thi s Section, including covenants relating to the collection of r evenues, shall be as specified in the certificate executed by the Gov ernor authorizing the issuance of the bonds.

inconsistent with thi s Section, including covenants relating to the collection of r evenues, shall be as specified in the certificate executed by the Gov ernor authorizing the issuance of the bonds. The certific ate may appoint one (1) or more trustees, co-trustees or other fidu ciaries authorized to receive and hold in trust the proceeds of the bo nds and monies relating thereto, to protect the rights of bondhold ers and to perform such other duties as may be specified in th e certificate. The Governor is also authorized to execute, on beha lf of the COL4/6/20225 GCA GOVERNMENT OPERATIONS CH. 22 GENERAL FISCAL POLICIES AND CONTROLS 45 government of Guam, any appropriate agreements, cer tificates or other instruments relating to the bonds and the sal e of the bonds. (h) Authorization for Credit Enhancement. The Gover nor is authorized to enter into such contracts or agreemen ts with such banks, insurance companies or other financial insti tutions as he determines are necessary or desirable to improve th e security and marketability of the bonds issued under this Sectio n. Such contracts or agreements may contain an obligation t o reimburse, with interest, any such banks,

y or desirable to improve th e security and marketability of the bonds issued under this Sectio n. Such contracts or agreements may contain an obligation t o reimburse, with interest, any such banks, insurance companies or other financial institutions for advances used to pay pri ncipal of or interest on the bonds. Any such reimbursement oblig ation shall be a general obligation of the government of Guam, and any such adva2nce, if necessary, shall be treated as creatin g a reimbursement obligation issued to refund the bonds . (i) Use of Proceeds from the Sale of the Bonds. Pro ceeds from the sale of the bonds shall be used solely to implement and equip the capital projects enumerated in subsection (m) of this Section, to pay general fund expenses listed in sub section (m) of this section and which are otherwise appropriated b y the Legislature, to establish necessary reserves, and t o pay expenses relating to the authorization, sale and issuance of the bonds, including, without limitation, printing costs, cost s of reproducing documents, bonds insurance premiums, underwriting, legal and accounting fees and charges, fees paid to banks or other financial institutions providing

imitation, printing costs, cost s of reproducing documents, bonds insurance premiums, underwriting, legal and accounting fees and charges, fees paid to banks or other financial institutions providing credit enhancement, costs of credit ratings, fees and charges for execution, transportation and safekeeping of bonds and other costs, charges and fees in connecti on with the issuance, sale and delivery of the bonds. The fees charged by the Guam Economic Development Authority for this bond i ssuance shall be waived. (j) No Personal Liability. No employee or elected o fficial of the government of Guam shall be individually or per sonally liable for the payment of any amounts due on any bonds iss ued under this Section, or for any other liability arising in connection with the bonds; provided, however, that nothing in this Section shall relieve any employee or elected official from the p erformance of any ministerial duty required by law. COL4/6/20225 GCA GOVERNMENT OPERATIONS CH. 22 GENERAL FISCAL POLICIES AND CONTROLS 46 (k) University of Guam Bond Fund. There is hereby c reated, separate and apart from other funds of the governme nt of Guam, a fund known as the 'University of Guam

RAL FISCAL POLICIES AND CONTROLS 46 (k) University of Guam Bond Fund. There is hereby c reated, separate and apart from other funds of the governme nt of Guam, a fund known as the 'University of Guam Bond Fund' (the 'UOG Bond Fund'). The UOG Bond Fund shall not be comming led with either the General Fund, the Current Fund of the Un iversity of Guam, or any other fund of the government of Guam. The UOG Bond Fund shall be held in an account or accounts a t a Guam financial institution or institutions separate and apart from all other accounts and funds of the government of Guam. All tuition revenues received by or on behalf of the University of Guam shall be deposited in the UOG Bond Fund and shall be acco unted for and used periodically only for the following purpos es and in the following order: (1) On a day when monies are remitted from the Gene ral Fund to any trustee, co-trustee or paying agent for the bonds to either pay the principal of and interest on the bonds issued for the capital project described in subsection (m) item (5) or to accumulate the amounts necessary to pay the prin cipal of or interest on said bonds, there shall immediately be transferred from the University

ital project described in subsection (m) item (5) or to accumulate the amounts necessary to pay the prin cipal of or interest on said bonds, there shall immediately be transferred from the University of Guam (UOG) Bond Fund to the General Fund an amount equal to, but not in excess of, the amount remitted from the General Fund. If the amount so transferred is not sufficient to fully reimburse the remittance, the amount of the deficiency shall be t ransferred immediately as it becomes available in the UOG Bond Fund, together with interest from the remittance date to the date of transfer at a rate equal to the yield on the bonds. Such transfers shall continue until November 15, 2018 or until a date mutually agreed upon by the University of Guam and I Maga’lahen Guåhan . Payments pursuant hereto made from the UOG Bond fund shall be adjusted downwards to re flect the interest rates of refinanced bonds if said inte rest rates are lower. (2) On the dates on which monies are transferred to the General Fund pursuant to paragraph (1) of this subs ection (k) of this Section, if such transfer is sufficient to fully reimburse the General Fund (with interest, if required), the balance remaining

General Fund pursuant to paragraph (1) of this subs ection (k) of this Section, if such transfer is sufficient to fully reimburse the General Fund (with interest, if required), the balance remaining in the UOG Bond Fund shall be transferred to the COL4/6/20225 GCA GOVERNMENT OPERATIONS CH. 22 GENERAL FISCAL POLICIES AND CONTROLS 47 Current Fund of the University of Guam to be utiliz ed only to implement the Physical Master Plan of the Univer sity. Such tuition revenue collections shall not be pledg ed to the payment of amounts due on the bonds, and this s ubsection (k) may be amended at any time by subsequent act of the Legislature. Nothing in this Section shall be const rued to prevent the government of Guam from issuing, after appropriate enabling legislation, for the benefit o f the University of Guam, other general obligations of th e government secured by such tuition revenues on a pa rity with the bonds authorized by this Section. In addition, nothing in this Section shall be construed to prevent the Univ ersity of Guam from issuing, after appropriate enabling legis lation, revenue bonds or general obligations of the Univers ity of Guam secured by such tuition revenues on a

nstrued to prevent the Univ ersity of Guam from issuing, after appropriate enabling legis lation, revenue bonds or general obligations of the Univers ity of Guam secured by such tuition revenues on a parity w ith the bonds authorized by this Section. (3) Notwithstanding Paragraphs (1) through (3) of t his Subsection (k), if the Board of Regent of the Unive rsity of Guam (University) elects to issue revenue bonds of the University pursuant to Chapter 17 of Title 17 of th e Guam Code Annotated, tuition revenues received by or on behalf of the University may be pledged as a first priority t o secure the payment of the obligations of the University with r espect to the revenue bonds, and may be used to pay such obli gations to create or replenish required reserves relating s uch revenue bonds, and to pay expenses directly related to the issuance and payment of such revenue bonds. In such event tu ition revenues shall be deposited, used and applied as pr ovided in the bond indenture, trust agreement or loan agreeme nt relating to such revenue bonds. (l) Guam Educational Facilities Fund. There is con tinued in existence, separate and apart from other funds of t he government of Guam, a

agreement or loan agreeme nt relating to such revenue bonds. (l) Guam Educational Facilities Fund. There is con tinued in existence, separate and apart from other funds of t he government of Guam, a fund known as the 'Guam Educational Faci lities Fund' (the GEF Fund). The GEF Fund shall not be co mmingled with the General Fund or any other fund of the gove rnment of Guam. The GEF Fund shall be held in an account or accounts at a Guam financial institution or institutions separa te and apart from all other accounts and funds of the government of G uam. All real COL4/6/20225 GCA GOVERNMENT OPERATIONS CH. 22 GENERAL FISCAL POLICIES AND CONTROLS 48 property tax revenues received by or on behalf of t he government of Guam pursuant to § 24103, Title 11, Guam Code An notated, shall be deposited in the GEF Fund and shall be acc ounted for and used periodically only for the following purposes a nd in the following order: (1) On the dates on which monies are remitted fro m the General Fund to any trustee, co-trustee or paying a gent for bonds issued pursuant to this Section or pursuant t o § 22435, Chapter 22 of Title 5 Guam Code Annotated, for the purpose of either (A) paying the

Fund to any trustee, co-trustee or paying a gent for bonds issued pursuant to this Section or pursuant t o § 22435, Chapter 22 of Title 5 Guam Code Annotated, for the purpose of either (A) paying the principal of and interest on the bonds designated as having been issued for the capital pr ojects enumerated in items (1), (2), (3), (4), (6), (7) an d (8) of subsection (m) of this Section, or paying the princ ipal of and interest on the bonds issued pursuant to § 22435, C hapter 22 of Title 5 Guam Code Annotated, or (B) accumulating the amounts necessary to pay the principal of or intere st on such bonds, there shall be transferred from the GEF Fund to the General Fund amounts equal to, but not in excess of , the amounts remitted from the General Fund for such pur poses, and in the event that the amount so transferred on any such date is insufficient to fully reimburse the amount so remitted, the amount of the insufficiency shall be transferre d as soon thereafter as it becomes available in the GEF Fund, together with interest from such remittance date to such dat e of transfer at a rate equal to the yield on the bonds.

shall be transferre d as soon thereafter as it becomes available in the GEF Fund, together with interest from such remittance date to such dat e of transfer at a rate equal to the yield on the bonds. (2) On the dates on which monies are transferred t o the General Fund pursuant to paragraph (1) of this subs ection (1) of this Section, if such transfer is sufficient to fully reimburse the General Fund, (with interest, if required), the balance remaining in the GEF Fund shall remain in the GEF F und and shall only be appropriated by I Liheslatura for the purpose of constructing, refurbishing, replacing and funding e ducational facilities and to fund the operations of the Guam C ommunity College. Such tax collections shall not be pledged to the p ayment of amounts due on such bonds and this subsection (l) m ay be amended at any time by subsequent act of I Liheslatura . Nothing in this Section or § 22435 of Chapter 22 of Title 5 Guam Code COL4/6/20225 GCA GOVERNMENT OPERATIONS CH. 22 GENERAL FISCAL POLICIES AND CONTROLS 49 Annotated shall be construed to prevent the governm ent of Guam from issuing, after appropriate enabling legislatio n, for the benefit of the government of Guam,

NERAL FISCAL POLICIES AND CONTROLS 49 Annotated shall be construed to prevent the governm ent of Guam from issuing, after appropriate enabling legislatio n, for the benefit of the government of Guam, other general obligation s or revenue obligations of the government secured by said real property tax revenues. The repayment obligation of the University of Guam described Title 5 GCA § 22425 (k) shall continue. (m) The capital projects to be implemented and equi pped with the proceeds of the bonds authorized by this S ection are as follows: Capital Projects: Allocated Amounts: (1) High sch ool located in Santa Rita, Guam $76,000,000; (2) Including a sewage treatment plant, infra structure an d off-site development, related to the high school in Santa Rita, Guam $21,000,000; (3) Elementary school located in Tamuning, Guam $15,000,000; (4) Elemen tary school located in Astumbo, Dededo, Guam $15,000,000; (5) Buildings at the University of Guam as follows: College of Arts and Sciences Building; renovation and addition to the Health Science Building; Plant Maintenance Building; Building II for the College of Agriculture and Life Sciences; College of Business and Public Administration;

lding; renovation and addition to the Health Science Building; Plant Maintenance Building; Building II for the College of Agriculture and Life Sciences; College of Business and Public Administration; Fine Arts Building; and the Student Center, $28,000,000; (6) For the purchase of equipment and furniture and the relocation $ 3,000,000; COL4/6/20225 GCA GOVERNMENT OPERATIONS CH. 22 GENERAL FISCAL POLICIES AND CONTROLS 50 expenses for students during construction of projects set out in items (1), (3) and (4) of this subsection (m), including temporary classrooms, (7) To the extent of any bond proceeds not required for the projects listed in Items (1) through (6) of this Subsection (m), any remaining balance other than the portions designated to be used for the Northern High School, or to pay General Fund expenses, may be applied to the cost of: (A) repairing or reconstructing the Inarajan Elementary School; (B) repairing or reconstructing the earthquake-damaged Ordot- Chalan Pago Elementary School; (C) reconstructing the earthquake-damaged gymnasium and classrooms at Inarajan High School; (D) repairing and reconstructing Upi Elementary School; (E) repairing or reconstructing

Elementary School; (C) reconstructing the earthquake-damaged gymnasium and classrooms at Inarajan High School; (D) repairing and reconstructing Upi Elementary School; (E) repairing or reconstructing earthquake damage at any other school; (F) design and construction of additional elementary schools in Guam, subject to Subsection (n) of this Section; (G) needed infrastructure improvements for schools; (H) the completion of design plans for the Northern High School; (I) the design, construction COL4/6/20225 GCA GOVERNMENT OPERATIONS CH. 22 GENERAL FISCAL POLICIES AND CONTROLS 51 and renovation of facilities, and capital improvement projects on the existing campus of the Guam Community College not to exceed One Million One Hundred Thousand Dollars ($1,100,000); (J) The Department of Education’s ten percent (10%) local share, over and above the approved FEMA funding, for the architectural, engineering design, construction and repair of the Jose Rios Middle School (formerly Piti Middle School) from damage resulting from Super Typhoon Paka and to add an additional classroom for Special Education needs; (K) Perform feasibility studies, pro forma cost projections and other documents

e School) from damage resulting from Super Typhoon Paka and to add an additional classroom for Special Education needs; (K) Perform feasibility studies, pro forma cost projections and other documents necessary to justify and/or obtain financing/leasing of additional schools or education facilities; (L) Replace two (2) classrooms destroyed by fire at L.P. Untalan Middle School; (M) Repair, replace, and/or modify air conditioners and air conditioning electrical systems for schools and repair of water infrastructure at the school. The Department of Education shall evaluate the following options on a school-by-school basis: (1) the cost to repair the units and electrical systems, (2) the cost to replace the air conditioning COL4/6/20225 GCA GOVERNMENT OPERATIONS CH. 22 GENERAL FISCAL POLICIES AND CONTROLS 52 systems with new systems, (3) the cost to install single units in each classroom, office or other enclosed facility, (4) the cost to add expansion units to existing systems, (5) any combination of the four (4) options herein and (6) the recurring cost to operate and maintain each of the four (4) options herein.

ty, (4) the cost to add expansion units to existing systems, (5) any combination of the four (4) options herein and (6) the recurring cost to operate and maintain each of the four (4) options herein. The Department of Education shall conduct a public hearing at each affected school prior to engaging any firm to supply systems, parts, or perform repairs. Any system purchased herein shall comply with the comfort and air quality standards set forth for Heating, Ventilation and Air Conditioning (HVAC) equipment as provided for by Chapter 5 of the Federal GSA’s Facilities Standards For Public Buildings Service (Revised November 2000 B PBS- P100); and (N) The Superintendent of the Department of Education ('DOE'), in consultation with the Guam Education Policy Board ('Board') shall have the authority and flexibility to review, and if necessary, reprogram such funds appropriated herein to DOE, to meet the needs of DOE, for repair, renovation and upgrade of public school facilities. (8) To the extent of any bond proceeds not required for the projects listed in Items ( A) COL4/6/20225 GCA GOVERNMENT OPERATIONS CH.

E, for repair, renovation and upgrade of public school facilities. (8) To the extent of any bond proceeds not required for the projects listed in Items ( A) COL4/6/20225 GCA GOVERNMENT OPERATIONS CH. 22 GENERAL FISCAL POLICIES AND CONTROLS 53 through (F) of this Subsection (m), any remaining balance, other than the portions designated to be used for the Northern High School or to pay general fund expenses, may be applied to the costs of : (A) repairing or reconstructing the Inarajan Elementary School, (B) repairing or reconstructing the earthquake damaged Ordot- Chalan Pago Elementary School, (C) reconstructing the earthquake damaged gymnasium and classrooms at Inarajan High School, (D) repairing or reconstructing Upi Elementary School, (E) repairing or reconstructing earthquake damage at any other school, (F) construction of additional elementary schools in northern Guam, subject to subsection (n) of this Section, (G) needed infrastructure improvements for schools, (H) the completion of design plans for the Northern High School, or (I) other projects approved by subsequent legislation.

ion (n) of this Section, (G) needed infrastructure improvements for schools, (H) the completion of design plans for the Northern High School, or (I) other projects approved by subsequent legislation. (9) The aggregate principal amount of bonds authorized to be issued to provide for the payment of general fund expenses is One Hundred Fifteen Million Dollars ($115,000,000), the proceeds of which to be used exclusively for the purposes outlined below. The COL4/6/20225 GCA GOVERNMENT OPERATIONS CH. 22 GENERAL FISCAL POLICIES AND CONTROLS 54 general fund expenses authorized to be paid with the proceeds of such bonds are income tax refund payments, supplemental retir ement payments, transfer payments to governmental agencies, and vendor payments, but in each case only to the extent such expenses have been incurred or previously obligated by the government for goods, services, and obligations rendered, received, or incu rred prior to May 15, 1995. (n) Uniform Design of Projects. In utilizing the b ond proceeds authorized by projects set out in items (3 ) and (4) of subsection (m) of this Section, in order to optimiz e funds and not replicate services, a standard and uniform design f or

g the b ond proceeds authorized by projects set out in items (3 ) and (4) of subsection (m) of this Section, in order to optimiz e funds and not replicate services, a standard and uniform design f or all elementary schools, shall be employed in their construction, u nless the topography and size of the land for such a school p revents the use of such a standard and uniform design. Such standar d and uniform designs shall be as energy efficient as is practica l, and shall conform to island styles. (o) Head Start Classrooms. The elementary schools d escribed in items (3) and (4) of subsection (m) of this Sect ion and whose construction is to be funded by this Act shall incl ude a minimum of five (5) 'Head Start' classrooms at each school. (p) Selection of Participants. In view of the urgen cy for the issuance of the bonds for the purpose of financing general fund expenses and for the infrastructure related to the high school located in Santa Rita, the Governor is hereby autho rized to utilize such method as he deems appropriate for the selecti on of all participants in connection with the issuance and sa le of those bonds, including trustees, depositories, paying age nts,

rized to utilize such method as he deems appropriate for the selecti on of all participants in connection with the issuance and sa le of those bonds, including trustees, depositories, paying age nts, underwriters, counsel, any credit enhancement provi der and any other participants; provided, however, that such se lection shall be subject to any provision of law which requires bidd ing, other competitive process, or any other procedure with re spect to such COL4/6/20225 GCA GOVERNMENT OPERATIONS CH. 22 GENERAL FISCAL POLICIES AND CONTROLS 55 selection, except that the Governor may limit the r equests for proposals for services associated with the issuance of the bonds to those firms that have previously participated in bo nd issues for Guam. (q) Notwithstanding any other provision of law, an y additional real property tax revenues received as a result of the most recent valuation of real property due to comme nce during the calendar years 2013 and 2014 is hereby continuo usly reserved, subject to annual appropriation, in an amount not t o exceed Eight Million Five Hundred Thousand Dollars ($8,500,000), from the Guam Educational Facilities Fund in the amounts and for the purposes

d, subject to annual appropriation, in an amount not t o exceed Eight Million Five Hundred Thousand Dollars ($8,500,000), from the Guam Educational Facilities Fund in the amounts and for the purposes set forth in this Subsection: (1) The sum of One Million One Hundred Fifty-Eight Thousand Two Hundred Eighty-Three Dollars ($1,158,2 83), beginning in FY 2015, for the construction of the S tudent Services Center and the Engineering Annex facility at the University of Guam, as a source of payment to the U niversity of Guam Capital Improvements Fund for the purpose o f paying rental payments due under the lease-leasebac k agreements with the University of Guam Endowment Foundation for a term of forty (40) years; includin g any lease-leaseback agreements entered into in connecti on with the interim financing; (2) The sum of Two Hundred Seventy-eight Thousand Nine Hundred Twenty-one Dollars and Fifty-two Cents ($278,921.52), beginning in FY 2014 for forty (40) years, for the construction or renovation of Building 100 and the DNA Laboratory at the Guam Community College; (3) The sum of One Hundred Thirty-two Thousand Fifteen Dollars ($132,015) to the Guam Public Libra ry System to hire a

renovation of Building 100 and the DNA Laboratory at the Guam Community College; (3) The sum of One Hundred Thirty-two Thousand Fifteen Dollars ($132,015) to the Guam Public Libra ry System to hire a Guam Librarian at Ninety-three Tho usand Three Hundred Seventy-seven Dollars ($93,377), and a Computer Analyst II at Thirty-eight Thousand Six Hu ndred Thirty-eight Dollars ($38,638); (4) The sum of One Million Seven Hundred Seven Thousand Six Hundred Fifty-two Dollars ($1,707,652) to the Guam Department of Education for the renovation or COL4/6/20225 GCA GOVERNMENT OPERATIONS CH. 22 GENERAL FISCAL POLICIES AND CONTROLS 56 construction of a new Simon Sanchez High School. (5) The sum of One Million Two Hundred Thousand Dollars ($1,200,000) for rental payments under the lease and the lease-back as described in Chapter 58D of Title 5, Guam Code Annotated. (6) other than the portions designated to be used f or in Items (1), (2), (3), (4) and (5) of this Subsection , eighty percent (80%) of the remaining balance for rental p ayments due under the lease-leaseback agreement with GDOE s ecured for the renovation or construction of a new Simon S anchez High School, to include its athletic

f the remaining balance for rental p ayments due under the lease-leaseback agreement with GDOE s ecured for the renovation or construction of a new Simon S anchez High School, to include its athletic facilities, an d other Guam Department of Education public school facilities re quiring new construction, rehabilitation or maintenance; (7) Early Childhood Program Fund. There is hereby created, separate and apart from all other funds of the government of Guam, a fund known as the 'Early Chil dhood Program Fund.' All monies received by or on behalf of the government of Guam pursuant to § 22425(q)(8) of Tit le 5 GCA, shall be deposited in the Fund and used for early childhood programs at the University of Guam, the G uam Community College, or the Guam Department of Educat ion. The Fund shall not be commingled with the General Fund or any other funds of the government of Guam, and it shall be maintained in a separate bank account. All monies i n the Fund shall require legislative appropriation, and shall not be subject to any transfer authority of I Maga’lahen Guåhan . (8) other than the portions designated to be used for in Items (1), (2), (3), (4) and (5) of this Subsection , 3.5% of

ion, and shall not be subject to any transfer authority of I Maga’lahen Guåhan . (8) other than the portions designated to be used for in Items (1), (2), (3), (4) and (5) of this Subsection , 3.5% of the remaining balance for the Early Childhood Program F und, as described in § 53101 of Title 17, Guam Code Annotat ed; (9) other than the portions designated to be used for in Items (1), (2), (3), (4) and (5) of this Subsection , 3.5 % of the remaining balance for I Famagu’on-ta , Child Adolescent Services Division of the Guam Behavioral Health and Wellness Center, and Project Karinu . These funds shall not be subject to I Maga’lahen Guåhan’s transfer authority. COL4/6/20225 GCA GOVERNMENT OPERATIONS CH. 22 GENERAL FISCAL POLICIES AND CONTROLS 57 (10) other than the portions designated to be used for in Items (1), (2), (3) (4) and (5) of this Subsection, five percent (5%) of the remaining balance to the Department of Revenue and Taxation for the following: (A) for maintenance support and sustainability of real property data and system; (B) for the five (5) year (quinquennial) property tax revaluation as mandated by law; (C) for enhancements, and technological advancements related to

sustainability of real property data and system; (B) for the five (5) year (quinquennial) property tax revaluation as mandated by law; (C) for enhancements, and technological advancements related to software/hardware, and supp ort staff necessary to improve electronic services; and (D) for other costs directly associated with improving the efficiency of the real property tax s ystem. The Director of the Department of Revenue and Taxation shall submit a report to I Maga’lahen Guåhan and I Liheslaturan Guåhan on a monthly basis as to the expenditures of the funds following the enactment o f this Act, detailing all transactions; (11) other than the portions designated to be used for in Items (1), (2), (3), (4) and (5) of this Subsectio n, five percent (5%) of the remaining balance shall be lock boxed for the procurement of a unified financial management infor mation system, as recommended by consensus from the Depart ment of Revenue and Taxation, the Department of Administ ration, the General Services Agency, the Office of Public Accountability, the Office of Technology, the Unive rsity of Guam, the Guam Community College, the Guam Departme nt of Education, and Guam Memorial

, the General Services Agency, the Office of Public Accountability, the Office of Technology, the Unive rsity of Guam, the Guam Community College, the Guam Departme nt of Education, and Guam Memorial Hospital Authority. This amount shall be subject to legislative appropriatio n. (12) Other than the portions designated to be used for in Items (1), (2) (3) (4) and (5) of this Subsection, three percent (3%) of the remaining balance shall be a source of funding for island-wide school bus shelters. The Director of the Department of Public Works shall submit a report to I Maga’lahen Guåhan and I Liheslaturan Guåhan on a COL4/6/20225 GCA GOVERNMENT OPERATIONS CH. 22 GENERAL FISCAL POLICIES AND CONTROLS 58 monthly basis as to the expenditures of the funds f ollowing enactment of this Act, detailing all transactions. (r) It is the policy of the Guam Legislature to ens ure that the projects enumerated in Subsection (m) of this Secti on are completed. In this respect, the Guam Legislature gi ves its consent and authorization to allow the transfer of funds be tween projects contained in Subsection (m), Items 1, 2, 3, 4, 6, 7 and 9.

n are completed. In this respect, the Guam Legislature gi ves its consent and authorization to allow the transfer of funds be tween projects contained in Subsection (m), Items 1, 2, 3, 4, 6, 7 and 9. The Guam Legislature shall be notified in writing prior to a ny transfer. This Subsection shall take effect immediately. (s) Interest earned on the bonds authorized by this Section shall be used exclusively for the projects enumerat ed in Subsection (m) of this Section. (t) Authorization of Issuance of General Obligation Loans for the Dededo Precinct and Crime Lab of the Guam Polic e Department. I Maga’lahen Guåhan is authorized to borrow one (1) or more general obligation loans of the governm ent of Guam in the aggregate principal amount not to exceed Sev en Million Dollars ($7,000,000) to undertake the cost of the d esign, plans and construction of the Dededo Police Precinct at a cos t not to exceed One Million Dollars ($1,000,000.00), and the cost o f the design, plans and construction of the Crime Lab at a cost n ot to exceed Six Million Dollars ($6,000,000), and paying expens es incurred in connection with the issuance and closing of such loans; provided, however, that the

uction of the Crime Lab at a cost n ot to exceed Six Million Dollars ($6,000,000), and paying expens es incurred in connection with the issuance and closing of such loans; provided, however, that the incurring of the loans shall not cause a violation of the debt limitations provision of Ti tle 48 U.S.C. § 1423a (§ 11 of the Organic Act of Guam). (1) Terms and Conditions Determined by Certificate. The terms and conditions of the loans shall be dete rmined by I Maga’lahen Guåhan by the execution of a certificate authorizing the incurring of the loans upon the inc urring of the loans; provided, however, that such terms and c onditions shall be consistent with this Subsection, and that the loans shall mature not later than December 31, 2013 and s hall bear interest at such rates as shall result in a yield t o the lending institutions not exceeding nine (9%) percent per an num. (2) Valid and Binding General Obligation. Any loan or loans authorized by this Section shall constitute t he valid and COL4/6/20225 GCA GOVERNMENT OPERATIONS CH. 22 GENERAL FISCAL POLICIES AND CONTROLS 59 binding general obligation of the government of Gua m.

authorized by this Section shall constitute t he valid and COL4/6/20225 GCA GOVERNMENT OPERATIONS CH. 22 GENERAL FISCAL POLICIES AND CONTROLS 59 binding general obligation of the government of Gua m. The government of Guam pledges its full faith and credi t for the punctual payment of both principal of and interest on the loans. There shall be collected annually in the sam e manner and at the same time as government revenue for othe r purposes is collected, such sum as is required to p ay the principal of and interest on the loans. All officer s charged by law with any duty in the collection of the revenues of the government shall do every lawful thing necessary to collect such sum. The validity of any such loans shall not be affected by the validity or regularity of any proceedings fo r the implementation of the capital projects funded by th e loans. (3) Appropriations from the General Fund. There are hereby appropriated from the General Fund such sums as will equal in each year the amount of money necessary to pay the principal and interest of such loans. (4) Additional Parity Loans.

d. There are hereby appropriated from the General Fund such sums as will equal in each year the amount of money necessary to pay the principal and interest of such loans. (4) Additional Parity Loans. Nothing in this Sectio n shall be construed to prevent the government of Gua m from issuing, after appropriate enabling legislation, ot her obligations of the government secured by the genera l obligation of the government on a parity with the l oans authorized by this Subsection. (5) Waiver of Immunity. Notwithstanding any substantive or procedural provision of Chapter 6 of Title 5 of the Guam Code Annotated, the government of Guam wai ves immunity from any suit or action in contract on the loans, but does not waive sovereign immunity as to the persona l liability of elected officials and employees of the government of Guam. (6) No Personal Liability. No employee or elected official of the government of Guam shall be individ ually or personally liable for the payment of any amounts du e on any loans granted under this Subsection, or for any oth er liability arising in connection with the loans; provided, how ever, that nothing in this Subsection shall relieve any employ ee or elected

n any loans granted under this Subsection, or for any oth er liability arising in connection with the loans; provided, how ever, that nothing in this Subsection shall relieve any employ ee or elected official from the performance of any minist erial duty required by law. COL4/6/20225 GCA GOVERNMENT OPERATIONS CH. 22 GENERAL FISCAL POLICIES AND CONTROLS 60 (7) Guam Police Department Loan Fund. There is hereby created, separate and apart from other funds of the government of Guam, a fund known as the ‘Guam Polic e Department Loan Fund’ (‘GPD Loan Fund’). The GPD Lo an Fund shall not be commingled with either the Genera l Fund or any other fund of the government of Guam. The GP D Loan Fund shall be held in an account or accounts at a G uam financial institution or institutions separate and apart from all other accounts or funds of the government of Guam. Annually, on or before the date payments of the pri ncipal and interest on the loan or loans are to become due, th e Director of the Department of Administration shall transfer from the GPD Police Services Fund and deposit in the GPD Loa n Fund the amounts necessary for the complete payment of the principal and interest then due.

Department of Administration shall transfer from the GPD Police Services Fund and deposit in the GPD Loa n Fund the amounts necessary for the complete payment of the principal and interest then due. In the event the f unds transferred from the GPD Police Services Fund is fo und to be insufficient, the Superior Court of Guam shall t ransfer from the Superior Court of Guam Building Fund and d eposit in the GPD Loan Fund One Hundred Thousand Dollars ($100,000.00) annually, on or before the date payme nts of the principal and interest on the loan or loans are to become due, to supplement the amounts necessary for the co mplete payment of the principal and interest then due. If the funds transferred from the GPD Police Services Fund is su fficient for the complete payment of the principal and inter est on the loan or loans, then the One Hundred Thousand Dollar s ($100,000.00) transferred from the Superior Court o f Guam shall be expended by GPD on cost of crime fighting equipment and training. All transfers of revenues f rom the GPD Police Services Fund and the Superior Court of Guam and received by or on behalf of the Guam Police Dep artment shall be deposited in the GPD Loan Fund

aining. All transfers of revenues f rom the GPD Police Services Fund and the Superior Court of Guam and received by or on behalf of the Guam Police Dep artment shall be deposited in the GPD Loan Fund and shall b e accounted for and used periodically only for the fo llowing purpose: (A) on the dates on which monies are remitted from the General Fund to any lending institution for the purpose of paying the principal and interest due on the loans authorized in this Subsection of this Section , there shall be transferred from the GPD Loan Fund to the COL4/6/20225 GCA GOVERNMENT OPERATIONS CH. 22 GENERAL FISCAL POLICIES AND CONTROLS 61 General Fund amounts equal to, but not in excess of , the amounts remitted from the General Fund for such purposes. SOURCE : Added by P.L. 22-019:2 (June 18, 1993), and amend ed by P.L. 23-014:2 (May 13, 1995). Subsection (m)(7) repeale d/reenacted by P.L. 24-025:1 (May 15, 1997), P.L. 24-059:III:3(e) (Sept . 12, 1997), and by P.L. 25-25:1; amended by P.L. 27-033:2 (Oct. 31, 20 03). Subsection (r) added by P.L. 24-025:2 (May 15, 1997), and repealed and reenacted by P.L. 24-059:III:3(f) (Sept. 12, 1997). Subsection (s) added by P.L.

5:1; amended by P.L. 27-033:2 (Oct. 31, 20 03). Subsection (r) added by P.L. 24-025:2 (May 15, 1997), and repealed and reenacted by P.L. 24-059:III:3(f) (Sept. 12, 1997). Subsection (s) added by P.L. 24- 025:3 (May 15, 1997). Subsection (k)(3) added by P .L. 24-312:5 (Dec. 23, 1998) as subsection (k)(4), codified to this subsec tion by the Compiler. Subsection (t) added by P.L. 24-243:2 (Aug. 14, 199 8). Subsection (l) amended by P.L. 28-068:II:I:39 (Sept. 30, 2005), a nd P.L. 28-149:II:VII:3 (Sept. 30, 2006). P.L. 29-002:VI:33 (May 18, 2007) repealed P.L. 28- 149:II:VII, therefore subsection (l) reverted to th e state it was in prior to P.L. 28-149, and amended by P.L. 29-019:VIII:2 (Sep t. 29, 2007). Subsection (l)(2) amended by P.L. 28-068:II:I:39 (S ept. 30, 2005). Subsection (k)(1) amended by P.L. 29-019:VII:11 (Se pt. 27, 2007). Subsection (q) amended by P.L. 32-063:3 (Aug. 30, 2 013) and P.L. 32- 120:3 (Feb. 10, 2014). Subsection (q), excluding ( 1) through (12), amended by P.L. 33-029:4 (May 7, 2015). Subsection (q)(7) added by P.L. 32-063:4 (Aug. 30, 2013). Subsection (q), and (q)( 1) amended by P.L. 33- 092:5 (Nov. 9, 2015).

), excluding ( 1) through (12), amended by P.L. 33-029:4 (May 7, 2015). Subsection (q)(7) added by P.L. 32-063:4 (Aug. 30, 2013). Subsection (q), and (q)( 1) amended by P.L. 33- 092:5 (Nov. 9, 2015). 2018 NOTE: References to 'Territorial' removed and/or altered to 'Guam' and references to the 'TEF Fund' (Territoria l Educational Facilities Fund) altered to the 'GEF Fund' (Guam Ed ucational Facilities Fund), pursuant to 1 GCA § 420. 2014 NOTE: P.L. 32-063:4 added 17 GCA § 53101, which was cod ified by the Compiler as 5 GCA § 22425(q)(7) because the subject matter fits more appropriately within Article 4 of this chapter . Subsection designations for subsection (q)(7-9) as amended by P.L.32-120:4 were renumbered to (q)(8-10) to adhere to the Compiler’s alpha-numeric scheme in accordance with the authority granted by 1 GCA § 1606. 2013 NOTE: Subsection designations in subsections (m)(7-8) a nd (t)(7) were altered in accordance with the authority grant ed by 1 GCA § 1606. 2009 NOTE: P.L. 28-045:10 (June 6, 2005) changed the name o f the Department of Education to the Guam Public School S ystem. P.L. 30- 050:2 (July 14, 2009) reverted the name to the Depa rtment of Education. § 22426.

28-045:10 (June 6, 2005) changed the name o f the Department of Education to the Guam Public School S ystem. P.L. 30- 050:2 (July 14, 2009) reverted the name to the Depa rtment of Education. § 22426. Conflict of Interest. (a) Notwithstanding any provision of law to the co ntrary whenever an Authority of the government sells bonds at a private sale, no person standing in a fiduciary relationshi p with the Authority shall purchase any of the bonds. COL4/6/20225 GCA GOVERNMENT OPERATIONS CH. 22 GENERAL FISCAL POLICIES AND CONTROLS 62 (b) As used in this Section, person means a natura l person, corporation, partnership, trust or the employer of a natural person. (c) If the provisions of this Section are violated then the sale of the bonds to the violating person shall be deeme d null and void ab initio. (d) Bonds unsold at bona fide public offerings can be held by the underwriters at the bona fide public offering p rices, less the underwriter’s discount. SOURCE : Added by P.L. 15-15:5. Subsection (d) added by P. L. 22-19:8. § 22427. Government of Guam Loan. (a) Authorization to Borrow. The Governor of Guam, on behalf of the government of Guam, is authorized to borrow an aggregate

. Subsection (d) added by P. L. 22-19:8. § 22427. Government of Guam Loan. (a) Authorization to Borrow. The Governor of Guam, on behalf of the government of Guam, is authorized to borrow an aggregate principal amount not to exceed Fifty-Two Million Nine Hundred Dollars ($52,900,000) to undertake the capi tal projects enumerated in subsection (g) of this Section; provi ded, however, that incurring this indebtedness shall not cause a violation of the debt limitation provisions of 48 U.S.C. § 1423(a). The debt may be incurred and the proceeds expended for the purpo se of allowing the government of Guam to pay for the cost of arran ging the loan and for the purposes described herein. (b) Terms and Conditions Determined by Loan Agreeme nt. The terms and conditions of the loan shall be as de termined by the Governor by the execution of a loan agreement autho rizing the loan. The loan agreement shall contain such terms a nd conditions as are consistent with this Section. The terms of t he loan shall include the following: (1) The loan shall be used by the Governor for the purposes stated herein; (2) Prepaid charges shall not be levied by the bank or trust department extending the loan;

oan shall include the following: (1) The loan shall be used by the Governor for the purposes stated herein; (2) Prepaid charges shall not be levied by the bank or trust department extending the loan; (3) The interest rate shall be subject to competiti ve negotiations between the Governor and the banks. (4) Interest derived from the loan shall be exempt from taxation by the government of Guam. COL4/6/20225 GCA GOVERNMENT OPERATIONS CH. 22 GENERAL FISCAL POLICIES AND CONTROLS 63 (5) All terms of the loan agreement not specificall y defined in the foregoing shall be negotiated by the Governor in the best interest of the people of Guam. (6) The duration for the repayment of the loan shal l be as negotiated by the Governor, but shall not exceed twenty (20) years. (7) The loan shall be arranged with any bank or commercial lending institution licensed on Guam; pr ovided, however, anything to the contrary in this Section notwithstanding, or any other provision of law, tha t the terms of the loan arranged by the Governor as provided by this Section, may permit the bank or commercial lending institution licensed on Guam with which such loan i s arranged, to grant participation in such loan,

an arranged by the Governor as provided by this Section, may permit the bank or commercial lending institution licensed on Guam with which such loan i s arranged, to grant participation in such loan, at s uch times and in such amounts and upon such terms and conditi ons as such bank or lending institution licensed in Guam s hall determine, to other banks, or commercial lending institutions, or to any other persons, associations , or corporations. The exemptions from taxation by the government of Guam of the interest derived from the loan shall be preserved to any such participant. (c) Appropriation from the Tourist Attraction Fund. There is hereby appropriated from the unencumbered balances of the Tourist Attraction Fund, notwithstanding anything i n 11 GCA § 30107 to the contrary, such sums as will equal in each year the amount of money necessary to pay the principal of a nd interest on such loan. (d) Waiver of Immunity. Notwithstanding any substan tive or procedural provisions of Chapter 6 of Title 5, Guam Code Annotated, the government of Guam waives immunity f rom any suit or action in contract on the loan but does not waive sovereign immunity as to the personal liability of

hapter 6 of Title 5, Guam Code Annotated, the government of Guam waives immunity f rom any suit or action in contract on the loan but does not waive sovereign immunity as to the personal liability of elected of ficials and employees of the government of Guam. (e) Form of Loan; Covenants. The technical form and language of the loan, including provisions for exec ution, exchange, transfer, negotiability, cancellation or other terms or conditions not inconsistent with this Section, shal l be as specified COL4/6/20225 GCA GOVERNMENT OPERATIONS CH. 22 GENERAL FISCAL POLICIES AND CONTROLS 64 in the loan agreement executed by the Governor evid encing the loan. The Governor is also authorized to execute, o n behalf of the government of Guam, any appropriate agreements or o ther instruments relating to the loan. (f) Bond Issue Rollover. The language of the loan a greement shall include provisions to permit the loan to be r olled over into a bond issue supported by the Tourist Attraction Fund . The Governor is urged to obtain a repayment schedule th at will provide for interest-only payments until the loan i s so rolled over. (g) Use of Loan Proceeds.

ported by the Tourist Attraction Fund . The Governor is urged to obtain a repayment schedule th at will provide for interest-only payments until the loan i s so rolled over. (g) Use of Loan Proceeds. The proceeds from the loa n shall be used solely to implement and equip the capital p rojects enumerated herein and to pay expenses relating to t he arrangement of the loan. The capital projects to be implemented and equipped with the proceeds of the loan authorized by this Se ction are as follows: Capital Projects Allocated Amounts (1) For Tumon Fafai Reversion Project, (A) For the acquisition and construction of the Gun Beach – Fafai Wastewater System $8,400,000 (B) For design and construction of the Tumon Pump Station and Force main $3,600,000 (C) For the refurbishment of the Northern District Sewage Treatment Plant $1,800,000 (D) For the refurbishment of the Agana Sewage Treatment Plant $2,000,000 (2) For Oka Point Collector System Project COL4/6/20225 GCA GOVERNMENT OPERATIONS CH. 22 GENERAL FISCAL POLICIES AND CONTROLS 65 (A) For design and construction of the Oka Point collector lines $2,000,000 (3) For Tumon Water Lines (A) For design and construction of waterlines $4,200,000

GENERAL FISCAL POLICIES AND CONTROLS 65 (A) For design and construction of the Oka Point collector lines $2,000,000 (3) For Tumon Water Lines (A) For design and construction of waterlines $4,200,000 (4) For Tumon Water Sources (A) For drilling and construction $5,800,000 (5) Tumon Bay Beautification (A) Streets & Sidewalks for medians, crosswalks and intersections, beach access, sidewalks and curbs, street furniture for benches, trash containers, signage, shelters, street lights and traffic lighting, enhancements for Governor Flores and Matapang Beach Parks $7,200,000 (B) Landscaping for medians, road edge strips, entry points from San Vitores Boulevard to beach access $3,900,000 (C) Services undergrounding for ocean side power lines and cables, clutter, removal of guy wires, and signage consolidations $4,500,000 (D) Design and management fees for design development, $1,600,000 COL4/6/20225 GCA GOVERNMENT OPERATIONS CH. 22 GENERAL FISCAL POLICIES AND CONTROLS 66 construction documentation, permitting, and construction management (E) Allowances for roadway repairs and restoration, resurfacing of San Vitores Boulevard, off-site infrastructure work, and related work $5,000,000 (F)

tation, permitting, and construction management (E) Allowances for roadway repairs and restoration, resurfacing of San Vitores Boulevard, off-site infrastructure work, and related work $5,000,000 (F) Of the approximately ten percent (10%) savings anticipated in carrying out the foregoing projects because of various duplications, Three Million Five Hundred Thousand Dollars ($3,500,000) are set aside for constructing the Tumon Bay Storm Drainage System. (G) Construction of the San Vitores substation and transmission lines by the Guam Power Authority in the Tumon Bay area. $5,900,000 (h) Selection of Bank. In view of the urgency for t he arrangement of the loan pursuant to this Section, s ubject to terms and conditions as outlined in this Act, the Governo r is hereby authorized to utilize such method as he deems appro priate for the selection of the bank or banks in connection with t he arrangement of the loan. (i) Approval of GEDA. Section 2103(k) of Title 12, Guam Code Annotated, provides that agencies and instrume ntalities of the government of Guam shall issue obligations only by means of and through the agency of the Guam Economic Develop ment COL4/6/20225 GCA GOVERNMENT

, provides that agencies and instrume ntalities of the government of Guam shall issue obligations only by means of and through the agency of the Guam Economic Develop ment COL4/6/20225 GCA GOVERNMENT OPERATIONS CH. 22 GENERAL FISCAL POLICIES AND CONTROLS 67 Authority ('GEDA'), and that GEDA shall not sell an y obligation without the approval of the legislature of the term s and conditions of the issuance of the obligations. In view of the urgency for the arrangement of the loan pursuant to this Section, t he original direct loan authorized hereunder is exempted from the requ irement of said Section 2103(k), but on the rollover of such l oan into a bond issue the section will fully apply. (j) Approval of the Legislature. This Legislature, pursuant to this section and pursuant to subsection 2103(k), Ti tle 12, Guam Code Annotated, hereby approves the loan of the gov ernment of Guam in the principal amount not to exceed Fifty-Tw o Million Nine Hundred Dollars ($52,900,000) as authorized by this Act; provided, that the terms of the loan are not incons istent with this Act. 2012 NOTE: In maintaining the general codification scheme of t he GCA the Compiler changed the hierarchy of

ized by this Act; provided, that the terms of the loan are not incons istent with this Act. 2012 NOTE: In maintaining the general codification scheme of t he GCA the Compiler changed the hierarchy of subsections b eginning with 'Lowercase Roman Numerals' to 'Numbers' in subsecti on (b) and subsections beginning with 'Numbers' to 'Uppercase Letters' in subsection (g). § 22428. Utility Expense Fund. There is created, separate and apart from other fu nds of the government of Guam, and under the administration an d control of the Department of Administration, the ‘Utility Expe nse Fund.’ Notwithstanding any other provisions of law , for each fiscal year, all appropriations from the General Fu nd to any Guam agency for the purpose of paying utility expenses f or electrical power, water, sewer and telephone services, shall b e deposited in the Utility Expense Fund, and shall be paid out sep arately by utility category and by the aggregate expenses of a gency billings. A report of the status of the Utility Expense Fund shall be made to the Governor and to the Guam Legislature at the end of each quarter. Unexpended funds after the end of each fis cal year shall revert to the General Fund.

of the Utility Expense Fund shall be made to the Governor and to the Guam Legislature at the end of each quarter. Unexpended funds after the end of each fis cal year shall revert to the General Fund. A report of this transa ction shall be made to the Guam Legislature. 2018 NOTE: References to 'Territory' and 'territorial' removed and/or altered to 'Guam' pursuant to 1 GCA § 420. NOTE : Public Law 24-57:2 creates a new Section 22427 to Title 5, Guam Code Annotated called the 'Utility Expense Fund'. B ut according to the Compiler another Public Law, specifically P.L. 23-1 37:2 also added COL4/6/20225 GCA GOVERNMENT OPERATIONS CH. 22 GENERAL FISCAL POLICIES AND CONTROLS 68 another § 22427 called the 'Government of Guam Loan '. The Compiler has then recodified Section 22427 (created by P.L. 24-57) as Section 22428. Renumbered by Compiler to reflect correct c itation. § 22429. Authorization and Approval of Refunding Bo nds. (a) Definitions. The following terms shall have th e following meanings when used in this Section: (1) 1989 Water Bonds means the Government of Guam Water System Revenue Bonds, Series 1989.

g Bo nds. (a) Definitions. The following terms shall have th e following meanings when used in this Section: (1) 1989 Water Bonds means the Government of Guam Water System Revenue Bonds, Series 1989. (2) 1992 Highway Bonds means the Government of Guam Limited Obligation Highway Bonds, 1992 Series A. (3) Prior Bonds means the 1989 water bonds and the 1992 highway bonds, to be redeemed or otherwise ret ired with the proceeds of refunding bonds and investment earnings thereon. (4) Refunding Bond means a bond issued pursuant to this Section for the purpose of providing moneys t o redeem and otherwise retire prior bonds, funding any neces sary bond reserves and capitalized interest allocable to the refunding bonds and paying expenses incurred in connection wi th the issuance of such refunding bonds. (5) Yield shall have the same meaning as when used in § 148 of the Internal Revenue Code of 1986, as amen ded. That is, ‘yield’ means the annual discount rate wh ich, when used to discount all payments of debt service on an issue of bonds to the date of issuance of the bonds, using a semiannual compounding interval, results in the aggregate pres ent value of such payments being equal to the

ayments of debt service on an issue of bonds to the date of issuance of the bonds, using a semiannual compounding interval, results in the aggregate pres ent value of such payments being equal to the re-offering pri ce to the public of such bonds. (6) Debt service means the scheduled principal of a nd interest on bonds plus fees to be paid for credit e nhancement of such bonds. (7) Debt Service Savings means the percentage by which the present value of debt service on refundin g bonds, not including capitalized interest, is less than th e present value of the remaining debt service on the prior b onds refunded by such refunding bonds. Present value sh all be COL4/6/20225 GCA GOVERNMENT OPERATIONS CH. 22 GENERAL FISCAL POLICIES AND CONTROLS 69 calculated for this purpose using the yield on the refunding bonds as the discount rate. (8) 1986 Bonds means the Government of Guam General Obligation Bonds, Series 1986, that are no longer outstanding. (9) Section 30 Revenues means the revenues derived by the government of Guam under 48 U.S.C. § 1421h (§ 3 0 of the Organic Act of Guam). (b) Authorization of Issuance of Bonds.

no longer outstanding. (9) Section 30 Revenues means the revenues derived by the government of Guam under 48 U.S.C. § 1421h (§ 3 0 of the Organic Act of Guam). (b) Authorization of Issuance of Bonds. I Maga’lahen Guåhan is authorized to issue on behalf of the government of Guam one (1) or more issues of bonds of the governm ent consisting of refunding bonds, subject to the follo wing requirements and limitations: (1) the issuance of the bonds shall not cause a vio lation of the debt limitation provisions of 48 U.S.C. § 14 23a (§ 11 of the Organic Act of Guam); (2) all obligation of the government to pay debt se rvice on, and the redemption price of, the prior bonds be ing refunded shall be discharged concurrently with the issuance of the refunding bonds. Thereafter, the prior bond s shall be payable solely from and secured solely by an escrow established for such purpose; (3) the debt service savings resulting from the iss uance of the refunding bonds shall be not less than three percent (3%); (4) the aggregate amount of scheduled debt service on the refunding bonds allocable to the refunding of t he 1989 water bonds shall be, in each year to and including the final maturity of

rcent (3%); (4) the aggregate amount of scheduled debt service on the refunding bonds allocable to the refunding of t he 1989 water bonds shall be, in each year to and including the final maturity of such refunding bonds, less than the max imum annual scheduled debt service on the 1989 water bon ds, and the final scheduled maturity date of such refunding bonds shall be not more than five (5) years after the fin al scheduled maturity date of the 1989 water bonds; and (5) the aggregate amount of scheduled debt service on the refunding bonds allocable to the refunding of t he 1992 highway bonds shall be, in each year to and includi ng the COL4/6/20225 GCA GOVERNMENT OPERATIONS CH. 22 GENERAL FISCAL POLICIES AND CONTROLS 70 final maturity of such refunding bonds, less than t he maximum annual scheduled debt service on the 1992 highway bonds, and the final scheduled maturity dat e of such refunding bonds shall be not more than five (5) yea rs after the final scheduled maturity date of the 1992 highw ay bonds. (c) Source of and Security for Payment. The refundi ng bonds shall be payable from and secured by the same sourc e or sources of revenues as the prior bonds refunded by the issu

1992 highw ay bonds. (c) Source of and Security for Payment. The refundi ng bonds shall be payable from and secured by the same sourc e or sources of revenues as the prior bonds refunded by the issu e. Any pledge or lien on revenues or other moneys authorized to b e granted with respect to the prior bonds refunded by the issue is hereby authorized to be granted with respect to the refund ing bonds. I Liheslaturan Guåhan hereby finds and declares that it is the policy of the government of Guam that § 30 Revenues shall be and remain the primary source of payment of any bonds i ssued to refund the 1989 water bonds. (d) Terms and Conditions Determined by Certificate. The terms and conditions of the refunding bonds shall b e as determined by I Maga’lahen Guåhan by the execution of a certificate or indenture authorizing the issuance o f such bonds. The certificate or indenture shall contain terms an d conditions that are consistent with this Section, and shall include substantially the same additional bond tests, rate covenants and othe r covenants as were applicable with respect to the prior bonds.

nditions that are consistent with this Section, and shall include substantially the same additional bond tests, rate covenants and othe r covenants as were applicable with respect to the prior bonds. T he proceeds of the refunding bonds may be used to fund a bond rese rve only if and to the extent that moneys from any bond reserve for the prior issue are transferred to the escrow from which the prior bonds will be paid. Interest on the refunding bonds may be ca pitalized for a period not exceeding fifteen (15) months. (e) Valid and Binding Obligations, Collection of Re venues. The bonds authorized by this Section shall constitu te the valid and binding obligations of the government of Guam. All officers charged by law with any duty in the collection of a ny revenues from which debt service on the issue is payable sha ll do every lawful thing necessary to collect the amount necess ary for such purpose. The validity of any such bonds shall not be affected by the validity or regularity of any proceedings for t he implementa- tion of the capital improvement projects funded by the prior bonds. COL4/6/20225 GCA GOVERNMENT OPERATIONS CH.

ll not be affected by the validity or regularity of any proceedings for t he implementa- tion of the capital improvement projects funded by the prior bonds. COL4/6/20225 GCA GOVERNMENT OPERATIONS CH. 22 GENERAL FISCAL POLICIES AND CONTROLS 71 (f) Appropriation. The revenues described in Subsec tion (c) of this Section are hereby continuously appropriate d for the purposes for which they are pledged. (g) Waiver of Immunity. Notwithstanding any substan tive or procedural provision of Chapter 6 of Title 5 of the Guam Code Annotated, the government of Guam waives immunity f rom any suit or action in contract on the bonds authorized by this Section, but does not waive sovereign immunity as to the per sonal liability of elected officials and employees of the governmen t of Guam. (h) Form of Bonds; Covenants; Appointment of Fiduci aries; Other Related Agreements. The technical form and la nguage of the refunding bonds, including provisions for execu tion, exchange, transfer, registration, paying agency, lo st or mutilated bonds, negotiability, cancellation and other terms, covenants or conditions not inconsistent with this Section, shal l be as specified in the certificate or indenture

aying agency, lo st or mutilated bonds, negotiability, cancellation and other terms, covenants or conditions not inconsistent with this Section, shal l be as specified in the certificate or indenture executed by I Maga’lahen Guåhan authorizing the issuance of the bonds. The certifi cate or indenture may appoint one (1) or more trustees or other fiduc iaries authorized to receive and hold in trust the proceed s of the bonds and moneys relating thereto, to protect the rights of bondholders and to perform such other duties as may be specifie d in the certificate. I Maga’lahen Guåhan is also authorized to execute, on behalf of the government of Guam, any appropriate a greements, certificates or other instruments relating to the b onds and the sale of the bonds, including, but limited to, an agreeme nt, certificate or instrument subordinating the pledge of revenues sec uring any other debt to the pledge of revenues securing the r efunding bonds. (i) Authorization for Credit Enhancement. I Maga’lahen Guåhan is authorized to enter into such contracts or agre ements with such banks, insurance companies or other finan cial institutions as I Maga’lahen Guåhan determines are necessary or

I Maga’lahen Guåhan is authorized to enter into such contracts or agre ements with such banks, insurance companies or other finan cial institutions as I Maga’lahen Guåhan determines are necessary or desirable to improve the security and marketability of any bonds authorized by this Section. Such contracts or agre ements may contain an obligation to reimburse, with interest, any such banks, insurance companies or other financial institutions for advances used to pay principal of or interest on the issue. Any obligations under such contract or agreement shall be payable s olely from the same sources as debt service on the refunding bonds is payable, COL4/6/20225 GCA GOVERNMENT OPERATIONS CH. 22 GENERAL FISCAL POLICIES AND CONTROLS 72 and any advance under such agreement, if necessary, shall be treated as creating a reimbursement obligation issu ed to refund the refunding bonds. (j) No Personal Liability. No employee or elected o fficial of the government of Guam shall be individually or per sonally liable for the payment of any amounts due on any bonds iss ued under this Section, or for any other liability arising in connection with the bonds; provided, however, that nothing in

y or per sonally liable for the payment of any amounts due on any bonds iss ued under this Section, or for any other liability arising in connection with the bonds; provided, however, that nothing in this Section shall relieve any employee or elected official from the p erformance of any ministerial duty required by law. (k) Approval by Guam Economic Development Authority . Section 50103(k) of Title 12 of the Guam Code Annot ated, provides that agencies and instrumentalities of the government of Guam shall issue bonds and other obligations only b y means of and through the agency of the Guam Economic Develop ment Authority (‘GEDA’). No issue of bonds authorized b y this Section shall be sold until the board of directors of GEDA has adopted a resolution approving the sale of such iss ue. (l) Approval of Terms and Conditions. Said § 50103( k) also provides that GEDA shall not sell any bond without the approval of I Liheslaturan Guåhan of the terms and conditions of the issuance of the bonds. I Liheslaturan Guåhan hereby approves the terms and conditions of the issuance of the bon ds authorized by this Section, so long as such bonds are structur ed as provided by this Act and achieve

nds. I Liheslaturan Guåhan hereby approves the terms and conditions of the issuance of the bon ds authorized by this Section, so long as such bonds are structur ed as provided by this Act and achieve the savings required by thi s Act. Upon issuance of bonds to refund the 1989 water bonds, § 30 Revenues and other funds held in the bond account for the 19 89 water bonds shall be released pursuant to this Act. (m) Approval by Guam Public Utilities Commission No t Required. Section 12004 of Title 12 of the Guam Cod e Annotated provides that the Guam Waterworks Authority (‘GWA’) shall not enter into any contractual agreements or obligation s which could increase rates and charges prior to the written app roval of the Public Utilities Commission. Because debt service on the refunding bonds issued to refund the 1989 water bon ds is expected to be paid from § 30 Revenues and not from GWA reve nues, and because the refunding bond indenture provisions rel ating to GWA revenues are to be substantially the same as such p rovisions in the COL4/6/20225 GCA GOVERNMENT OPERATIONS CH. 22 GENERAL FISCAL POLICIES AND CONTROLS 73 1989 water bond indenture, the entry by GWA into th e refunding bond

antially the same as such p rovisions in the COL4/6/20225 GCA GOVERNMENT OPERATIONS CH. 22 GENERAL FISCAL POLICIES AND CONTROLS 73 1989 water bond indenture, the entry by GWA into th e refunding bond indenture is hereby deemed not to increase rat es and charges in and of itself, is hereby authorized and approved , and shall not be required to be approved by the Guam Public Utili ties Commission. (n) Variable Rate Bonds and Interest Rate Hedges. R efund- ing bonds issued to refund the 1989 water bonds may be issued as bonds bearing interest at a variable rate, and I Maga’lahen Guåhan is authorized to enter into one (1) or more intere st rate hedging contracts, including, but not limited to, a rrangements commonly known as swap agreements, floors, caps and collars, which I Maga’lahen Guåhan determines to be necessary or appropriate to place the obligations of the governm ent of Guam, as represented by the refunding bonds and such inte rest rate hedging contracts, on a basis other than a fully va riable rate basis, but only under the following terms and conditions, which are applicable in such circumstances in lieu of the req uirements of Paragraphs (3) and (4) of Subsection (b) of

a fully va riable rate basis, but only under the following terms and conditions, which are applicable in such circumstances in lieu of the req uirements of Paragraphs (3) and (4) of Subsection (b) of this Se ction: (1) the initial interest rate hedging contracts, if any must have an aggregate term of not less than two (2) yea rs; (2) each year over the longer of the first five (5) years after the date of issuance of the bonds or the term of any initial interest rate hedging contracts, the maximu m net annual obligation of the government, as represented by the refunding bonds and such interest rate hedging cont racts, must be expected, on the basis of the prior ten (10 ) years experience with comparable bonds and interest rate hedging contracts, not to exceed the annual obligation that the government would have had if the refunding bonds ha d been issued as fixed-rate, current-interest bonds meetin g the criteria of Paragraphs (3) and (4) of Subsection (b ) of this Section; (3) the aggregate principal amount of refunding bon ds outstanding at the later of the end of the first fi ve (5) years after the date of issuance of the bonds or the end of the term of any initial interest rate

egate principal amount of refunding bon ds outstanding at the later of the end of the first fi ve (5) years after the date of issuance of the bonds or the end of the term of any initial interest rate hedging contracts may not exceed the aggregate principal amount of refunding bonds t hat would have been outstanding had the refunding bonds been COL4/6/20225 GCA GOVERNMENT OPERATIONS CH. 22 GENERAL FISCAL POLICIES AND CONTROLS 74 issued as fixed-rate, current-interest bonds meetin g the requirements of Paragraphs (3) and (4) of Subsectio n (b) of this Section; (4) the final scheduled maturity date of such refun ding bonds shall be not more than five (5) years after t he final scheduled maturity date of the 1989 water bonds; an d (5) upon any conversion of the variable rate refund ing bonds to fixed rate, any period during which the fi xed rate bonds are not subject to optional redemption shall be less than one and one-half (1.5) years. (o) Permitted Investments. The proceeds of bonds is sued by the government, and any revenues relating to such b onds, may be invested in, but only in, the types of investments permitted by the certificate or indenture pursuant to which such bon ds are

sued by the government, and any revenues relating to such b onds, may be invested in, but only in, the types of investments permitted by the certificate or indenture pursuant to which such bon ds are issued. SOURCE : Added by P.L. 25-003:IV:29.. Amended by P.L. 25- 115:1. § 22430. Source of Payment for Government Notices/W ebsite Required. (a) Any website, public notice, advertisement or me ssage issued or published by an agency, or agencies, and paid for, partially or fully, using government funds shall in clude a disclosure statement that the public notice, advert isement or message is paid for by government funds, and the na me of the agency or agencies paying for the notice. (b) As used in this Section, Agency means any autho rity of the government, and includes a department, institut ion, board, bureau, commission, council, committee of Guam gove rnment, branch, autonomous instrumentality or other public entity of the government of Guam, whether or not it is within or subject to review by another agency. (c) Public notice, advertisement or message as used in this Section means all media including print, radio, tel evision or the internet. SOURCE : Added by P.L. 26-012:1.

to review by another agency. (c) Public notice, advertisement or message as used in this Section means all media including print, radio, tel evision or the internet. SOURCE : Added by P.L. 26-012:1. Amended by P.L. 30-119:1 (Apr. 1, 2010). 2018 NOTE: References to 'Territory' and 'territorial' removed and/or altered to 'Guam' pursuant to 1 GCA § 420. COL4/6/20225 GCA GOVERNMENT OPERATIONS CH. 22 GENERAL FISCAL POLICIES AND CONTROLS 75 § 22431. Line of Credit. [Repealed.] SOURCE : Added by P.L. 26-85:2 as § 22429, which section already exists. Subsection (b)(vii) added by P.L. 26-122:9. Subsection (a) added by P.L. 26-122:10. Subsection (b)(v) amended by P.L . 26-122:11. Subsection (b)(viii) added by P.L. 26-122:12. Repe aled by P.L. 26-156:1 (Dec. 13, 2002). The remainder of P.L. 26-156 is u ncodified and provides for lines of credit and other Typhoon Pongsona reco very measures. § 22432. Creation of Fund. (a) There is hereby created, separate and apart fr om other funds of the government of Guam, a fund to be known as the 'Line of Credit Repayment Fund' (Fund). The Fund shall not be commingled with the General Fund and shall be kept in a separate bank account, under the purview

nment of Guam, a fund to be known as the 'Line of Credit Repayment Fund' (Fund). The Fund shall not be commingled with the General Fund and shall be kept in a separate bank account, under the purview of the Public Audit or. The funds deposited into the Line of Credit Repayment Fund ar e hereby appropriated for the repayment of the line of credi t authorized by I Liheslaturan Guåhan [Guam Legislature] in 5 GCA § 22431(a). (b) All payments made pursuant to the written paym ent plans executed between the government and taxpayers for balance taxes due for all tax years, other than tax year 20 01, not subject to an existing levy, payroll deduction, or written vol untary agreement, or constitute an account deemed by the D epartment of Revenue and Taxation to be pending due to litigatio n or other legal problems, shall be deposited into the Fund to be so lely used for the repayment of the line of credit authorized here in. (c) The Department of Revenue and Taxation shall p rovide I Maga’lahen Guåhan [Governor] and I Liheslaturan [Guam Legislature] Guåhan on a bi-weekly basis, upon the enactment of this Section, the total amount of balance taxes due , subject to a written payment plan,

hen Guåhan [Governor] and I Liheslaturan [Guam Legislature] Guåhan on a bi-weekly basis, upon the enactment of this Section, the total amount of balance taxes due , subject to a written payment plan, and the number of taxpayers e xecuting the written payment plan. (d) The deposits made to the Fund pursuant to 5 GC A § 22432(b) shall be invested or reinvested in interes t-bearing instruments, United States treasury notes, investme nt grade and insured corporate notes, and other like instruments which are readily convertible to cash needed to pay for the l ine of credit COL4/6/20225 GCA GOVERNMENT OPERATIONS CH. 22 GENERAL FISCAL POLICIES AND CONTROLS 76 authorized by I Liheslaturan Guåhan in § 22429(a) of Title 5 of the Guam Code Annotated. SOURCE : Added by P.L. 26-85:3 as § 22430. Renumbered by Compiler as that section already exists. § 22433. Authorization Conditioned. The authorization of the line of credit as set for th in 5 GCA § 22431(a) shall become effective only after I Maga’lahen Guåhan [the Governor] reduces the total salary spending f or unclassified positions, not to include licensed pro fessionals, within the government of Guam by Two Million Dollar s ($2,000,000).

’lahen Guåhan [the Governor] reduces the total salary spending f or unclassified positions, not to include licensed pro fessionals, within the government of Guam by Two Million Dollar s ($2,000,000). SOURCE : Added by P.L. 26-85:4 as § 22431. Renumbered by Compiler as that section already exists. § 22434. Expiration Date for Encumbrances. (a) An encumbrance against any type of appropriat ion shall be automatically returned to the Fund against which it was encumbered nine (9) months after fiscal year end i n which the encumbrance was originally recorded, unless the enc umbrance falls under requirements imposed by United States l aw governing United States Federal awards. (b) Encumbrances that are returned to the Fund aga inst which it was encumbered are hereby de-appropriated. The appropriate government of Guam department, agency, instrumentality, or public corporation incurring th e encumbrance may submit a request for a re-appropriation immedia tely, to [the Legislature] I Liheslaturan Guåhan . The request for a re- appropriation shall include, but not be limited to, the reason why such appropriation is necessary, and details on the delay of expending the original encumbrance by

an Guåhan . The request for a re- appropriation shall include, but not be limited to, the reason why such appropriation is necessary, and details on the delay of expending the original encumbrance by the requestin g department, agency, instrumentality, or public corp oration. (c) All capital improvement, or capital outlay pro ject encumbrances shall be exempted from this Section. SOURCE : Added as § 22430 by P.L. 27-78:1. Renumbered by Compiler because that number was already occupied by another section and not repealed. § 22435. Authorization to Issue Bonds for Certain Capital COL4/6/20225 GCA GOVERNMENT OPERATIONS CH. 22 GENERAL FISCAL POLICIES AND CONTROLS 77 Expense Items and Capital Improvement Projects of S chool Facilities and for Other Purposes. (a) Authorization to Issue Bonds. I Maga’lahen Guåhan is authorized to issue one (1) or more series of bonds of the government of Guam in the aggregate principal amoun t necessary to fund an escrow for the refinancing of the Genera l Fund obligations listed in subsection (k)(1) hereof and to provide no more than Ninety Million Dollars ($90,000,000) for the payment of the General Fund expenses listed in subsection ( k)[(2), (3),

l Fund obligations listed in subsection (k)(1) hereof and to provide no more than Ninety Million Dollars ($90,000,000) for the payment of the General Fund expenses listed in subsection ( k)[(2), (3), (4), (5), (6), (7), (8), (9) and (10)] hereof, and, in each case, to fund necessary reserves and to pay expenses incurred in the issuance of such bonds not already provided for by an existing appropriation for or in the regular budget of a government agency , instrumentality or public corporation that provides any services regarding the issuance of such bonds; provided that said bonds shall not be issued in an amount that would create a violation of the debt limitation imposed by 48 U.S.C. 1423a (§11 of the Organic Act of Guam). (b) Terms and Conditions. The terms and conditions of said bonds shall be as determined by I Maga’lahen Guåhan and expressed by his execution of a certificate or inde nture authorizing issuance of the bonds; provided that said terms and conditions shall be consistent herewith, and that the bonds sh all mature no later than the year 2037, and shall bear interest a t such rates and be sold for such prices as shall result in a yield to the bondholders not

consistent herewith, and that the bonds sh all mature no later than the year 2037, and shall bear interest a t such rates and be sold for such prices as shall result in a yield to the bondholders not exceeding six and ninety five hundredths percen t (6.95%) per annum. The annual debt service for any of the gove rnment of Guam General Obligation Bonds, 1993 Series A, to re main outstanding, together with the annual debt service on the bonds authorized by this Section, for any given year shal l not exceed the aggregate annual debt service for said bonds for th e previous year or the next succeeding year by more than one percen t (1%); provided that no repayment of principal of the bond s authorized by this Section shall be required during the first two (2) years after their issuance. (c) Valid and Binding General Obligations. The bond s authorized by this Section shall constitute valid a nd binding general obligations of the government of Guam. The government COL4/6/20225 GCA GOVERNMENT OPERATIONS CH. 22 GENERAL FISCAL POLICIES AND CONTROLS 78 of Guam pledges its full faith and credit for the p unctual payment of both the principal and interest on the bonds.

4/6/20225 GCA GOVERNMENT OPERATIONS CH. 22 GENERAL FISCAL POLICIES AND CONTROLS 78 of Guam pledges its full faith and credit for the p unctual payment of both the principal and interest on the bonds. T here shall be collected annually, in the same manner and at the s ame time as government revenue for other purposes is collected, a sum adequate to pay the principal of and interest on th e bonds. All officers charged by law with any duty in the collec tion of government revenues from which debt service on the bonds will be paid shall do every lawful thing necessary to co llect such sum. The validity of said bonds shall not be affected by the validity or regularity of any proceedings for the payment of th e General Fund expenses paid or to be paid with bond proceeds. (d) Appropriations from the General Fund. There is hereby appropriated from the General Fund an amount suffic ient to pay the principal and interest on said bonds. (e) Additional Bonds. Nothing herein shall be cons trued to prohibit the government of Guam from issuing, after appropriate enabling legislation, other obligations of the gove rnment secured by the general obligation of the government on a pa rity with or

to prohibit the government of Guam from issuing, after appropriate enabling legislation, other obligations of the gove rnment secured by the general obligation of the government on a pa rity with or subordinate to the bonds authorized hereby on such terms as are created by the bond indenture or certificate. Noth ing herein shall be construed to prohibit the government of Guam fro m issuing, after appropriate enabling legislation, other oblig ations of the government secured by Real Property Tax Revenues. (f) Waiver of Immunity; Submission to Jurisdiction . Notwithstanding Chapter 6 of Title 5 Guam Code Anno tated, the government of Guam hereby waives immunity from any suit or action in contract based on the said bonds, but doe s not waive immunity regarding the personal liability of electe d officials and employees of the government of Guam. Any such acti on may be brought in the District Court of Guam. (g) No Personal Liability. No employee or elected official of the government of Guam shall be personally liable f or the payments due on the bonds issued pursuant hereto, o r for any other liability arising in connection with the bonds; pro vided that nothing herein relieves any

Guam shall be personally liable f or the payments due on the bonds issued pursuant hereto, o r for any other liability arising in connection with the bonds; pro vided that nothing herein relieves any employee or elected off icial from the performance of a ministerial duty required by law. COL4/6/20225 GCA GOVERNMENT OPERATIONS CH. 22 GENERAL FISCAL POLICIES AND CONTROLS 79 (h) Form of Bonds; Covenants; Appointment of Fiduc iaries. The technical form and language of the bonds, inclu ding provisions for execution, exchange, transfer, regis tration, paying agency, lost or mutilated bonds, negotiability, can cellation and other terms or conditions not inconsistent with thi s Section, including covenants relating to the collection of r evenues, shall be as specified in the certificate or indenture execut ed by I Maga’lahen Guåhan authorizing issuance of the bonds. The Trustees on the prior bonds shall remain as Trustee s on the refunding bonds. The Trustee, Co-Trustee or other fiduciaries are authorized to receive and hold in trust the proceed s of the bonds, the revenues and other moneys relating thereto, to protect the rights of bondholders and to perform such other dut ies as may be

re authorized to receive and hold in trust the proceed s of the bonds, the revenues and other moneys relating thereto, to protect the rights of bondholders and to perform such other dut ies as may be specified by the certificate or indenture. I Maga’lahen Guåhan may execute, on behalf of the government of Guam, any appropriate agreements, cer tificates or other instruments relating to the bonds and the sal e of bonds. (i) Authorization for Credit Enhancement. I Maga’lahen Guåhan is authorized to enter into such contracts or agre ements with such banks, insurance companies or other finan cial institutions as he determines are necessary or desi rable to improve the security and marketability of the bonds issued under this Section. Such contracts or agreements may contain an obligation to reimburse, with interest, any such bank, insuran ce company or other financial institution for advances it makes t o pay the principal of or interest on the bonds and to indemn ify any such bank, insurance company or other financial institut ion for costs and expenses incurred in connection with any such a dvance.

pay the principal of or interest on the bonds and to indemn ify any such bank, insurance company or other financial institut ion for costs and expenses incurred in connection with any such a dvance. Any such reimbursement obligation and any other obligat ions of the government under such contracts or agreements shall be general obligations of the government of Guam and any such advance, if necessary, shall be treated for Organic Act purpose s as creating an obligation issued to refund the bonds. (j) Use of Proceeds from the Sale of the Bonds. Th e proceeds from the sale of the bonds shall be used and are he reby appropriated to (1) refinance the General Fund obli gations and to fund the capital projects and other purposes descri bed in subsection (k) hereof; (2) establish necessary rese rves; (3) pay COL4/6/20225 GCA GOVERNMENT OPERATIONS CH. 22 GENERAL FISCAL POLICIES AND CONTROLS 80 expenses relating to the authorization, sale and is suance of the bonds, including, without limitation, printing cost s, costs of reproducing documents, credit enhancement fees, und erwriting, legal, financial advisory and accounting fees and c harges, fees paid to banks or other financial

limitation, printing cost s, costs of reproducing documents, credit enhancement fees, und erwriting, legal, financial advisory and accounting fees and c harges, fees paid to banks or other financial institutions provi ding credit enhancement, costs of credit ratings and other cost s, charges and fees in connection with the issuance, sale and deli very of the bonds; and (4) fund capitalized interest on the bon ds issued for the purposes described in subsection (k)(1) hereof for a period ending not later than thirty (30) months from the receipt of proceeds. (k) Use of Proceeds of Bonds. The proceeds of sai d bonds are appropriated as follows: (1) to fund an escrow account to pay debt service on all or a portion of the Government of Guam General Obligation Bonds, 1993 Series A. (2) Twenty-nine Million Five Hundred Four Thousand Dollars ($29,504,000) to fund the capital expense i tems and capital improvement projects of the Department of E ducation needed to comply with the Every Child is Entitled t o an Adequate Public Education Act as listed in Attachme nts A and A-1. Effective October 23, 2014, the Superinten dent of Education is authorized to expend the remaining fun ds for

ild is Entitled t o an Adequate Public Education Act as listed in Attachme nts A and A-1. Effective October 23, 2014, the Superinten dent of Education is authorized to expend the remaining fun ds for facilities repair, and air conditioning and equipme nt repair and replacement for public schools. (3) Sixteen Million Dollars ($16,000,000) to fund payments to COLA Class awardees as ordered by the Judgment in Rios v. Camacho, Superior Court Case No. SP0206-93. (4) Twenty-one Million One Hundred Ninety-six Thousand Dollars ($21,196,000) to fund past due Inc ome Tax Refunds. (5) Two Million Six Hundred Forty Thousand Dollars ($2,640,000) to fund capital improvement projects o f the Guam Memorial Hospital and Three Hundred Sixty Thousand Dollars ($360,000) for the University of G uam to fund renovations and expansion of the Nursing/Healt h Science Building. COL4/6/20225 GCA GOVERNMENT OPERATIONS CH. 22 GENERAL FISCAL POLICIES AND CONTROLS 81 (6) Two Million Dollars ($2,000,000) to meet obligations imposed by the Permanent Injunction (Di strict Court of Guam CIV01-00041) on the Department of Integrated Services for Individuals with Disabiliti es, provided that said funds shall only be

ligations imposed by the Permanent Injunction (Di strict Court of Guam CIV01-00041) on the Department of Integrated Services for Individuals with Disabiliti es, provided that said funds shall only be made availa ble to the Department if the District Court approves its revis ed Guam Comprehensive Integration Plan. (7) Four Million Dollars ($4,000,000) to meet obligations imposed by the Permanent Injunction (Di strict Court of Guam CIV01-00041) on the Guam Behavioral Health and Wellness Center, provided that said fun ds shall only be made available to the Department if the Dis trict Court approves its revised Guam Comprehensive Integration Plan. (8) One Million Dollars ($1,000,000.00) to fund personnel and operations costs of the Department of Revenue and Taxation necessary to implement an Aggressive T ax Collection Effort in FY2009. (9) Three Hundred Thousand Dollars ($300,000) to t he Department of Education for school water tanks and water fountains. (10) The remaining balance of the bond proceeds s hall be used first to fund up to Two Million Dollars ($2 ,000,000) for the Department of Law’s APASI system and second to fund the capital and operating expenses of the Guam Memorial

bond proceeds s hall be used first to fund up to Two Million Dollars ($2 ,000,000) for the Department of Law’s APASI system and second to fund the capital and operating expenses of the Guam Memorial Hospital. (l) Permitted Investments. The proceeds of the bon ds and any revenues from the such bonds shall be invested only in investments authorized by the certificate or indent ure pursuant to which the bonds are issued. (m) Approval by the Guam Economic Development and Commerce Authority. No bonds authorized by this Sec tion shall be sold until the Board of Directors of GEDCA has a dopted a resolution approving the sale. (n) Approval of Voters Not Required. Notwithstandi ng Title 3 Guam Code Annotated §§ 17311 and 17312, the issua nce of the COL4/6/20225 GCA GOVERNMENT OPERATIONS CH. 22 GENERAL FISCAL POLICIES AND CONTROLS 82 bonds authorized hereby shall not be subject to the approval of the voters of Guam. SOURCE : Added by P.L. 28-149:II:VII:2 (Sept. 30, 2006). R epealed by P.L. 29-002:VI:33 (May 18, 2007). Added by P.L. 29- 019:VIII:1 (Sept. 29, 2007). Subsection (k)(8) amended by P.L. 29-11 3:VI:24 (Sept. 30, 2008). Subsection (k)(2) amended by P.L. 32-207:8 ( Oct. 31, 2014).

002:VI:33 (May 18, 2007). Added by P.L. 29- 019:VIII:1 (Sept. 29, 2007). Subsection (k)(8) amended by P.L. 29-11 3:VI:24 (Sept. 30, 2008). Subsection (k)(2) amended by P.L. 32-207:8 ( Oct. 31, 2014). 2007 COMMENT: Public Law 21-019:VIII:5 (Sept. 29, 2007), as amended by P.L. 29-021:5 (Oct. 22, 2007) provides: Section 5. Early Redemption of Bonds. The certificate or indenture authorized by Title 5 GCA $22435 shall au thorize the early redemption, on or after November 15, 201 7, of the bonds authorized thereby. Fifty percent (50%) of an y amount in excess of One Hundred Million Dollars ($100,000, 000) paid to the government of Guam by the Government of the United States pursuant to Section 30 of the Organic Act, T itle 48 U.S. Code §1421h, in any fiscal year shall be used for t he early redemption of said bonds. 2013 NOTE: Pursuant to P.L. 32-024:2 (May 6, 2013) which ren amed the Department of Mental Health and Substance Abuse (DM HSA) to the Guam Behavioral Health and Wellness Center, all ref erences to DMHSA were altered to the Guam Behavioral Health and Well ness Center. § 22436. General Fund Appropriations to the Rainy D ay Fund Cap.

Guam Behavioral Health and Wellness Center, all ref erences to DMHSA were altered to the Guam Behavioral Health and Well ness Center. § 22436. General Fund Appropriations to the Rainy D ay Fund Cap. (a) Beginning in Fiscal Year 2010, I Liheslatura (the Legislature) shall not appropriate more than ninety -eight percent (98%) of the total revenues projected for the Gener al Fund for the fiscal year until such time as the General Fund def icit is eliminated. All unappropriated annual General Fund revenues collected in excess of appropriations shall be used to liquidate obligations for refunds, earned income tax credits and prior years’ vendor payables. I Liheslatura (the Legislature) shall appropriate not less than two percent (2%) of the total revenues projected fo r the General Fund for each fiscal year to the Rainy Day Fund est ablished pursuant to § 22901, Article 9, Division 2, Chapter 22, Title 5, Guam Code Annotated, until such time as indicated i n § 22904, Article 9, Division 2, Chapter 22, Title 5 GCA. (b) Emergency. To the extent necessary to deal with any disaster or emergency this General Fund Appropriati ons Cap may COL4/6/20225 GCA GOVERNMENT OPERATIONS CH.

Division 2, Chapter 22, Title 5 GCA. (b) Emergency. To the extent necessary to deal with any disaster or emergency this General Fund Appropriati ons Cap may COL4/6/20225 GCA GOVERNMENT OPERATIONS CH. 22 GENERAL FISCAL POLICIES AND CONTROLS 83 be temporarily lifted in the event I Maga’håga (the Governor), the President of the United States, or I Liheslatura (the Legislature) by vote of a majority of its Members declares Guam to be in a state of emergency or any similar designation. SOURCE : Added by P.L. 29-113:VI:23 (Sept. 30, 2008), enti tled 'General Fund Appropriations Cap.' Amended and rena med by P.L. 35- 036:XII:26 (Sept. 4, 2019). § 22437. Approval of Financial Agreements or Arran gements . Any financial agreement or arrangement between the government of Guam with any bank, private banking f irm, brokerage firm, bond brokerage firm, or similar fin ancial institutions which uses, pledges, or arbitrages any government revenue, trust funds, debt service payment deposits with trustees, bond proceeds, or interests on any of these, not specifically authorized by existing statute authorizing the issu ance or refinancing of bonds, shall require legislative approval; and any income

ees, bond proceeds, or interests on any of these, not specifically authorized by existing statute authorizing the issu ance or refinancing of bonds, shall require legislative approval; and any income generated from such financial agreement and arrangement shall require legislative appropriation. SOURCE: Added as uncodified law by P.L. 32-068:XII:19 (Se pt. 11, 2013), codified to this section by the Compiler and stricken pursuant to P.L. 32-181:XIII:19 (Sept. 5, 2014). Added by P.L. 33-066:XII:21 (Sept. 5, 2015). § 22437. Timing of Municipal Lease Payments. For the budget act period of Fiscal Year 2018, and for each subsequent budget act period thereafter, executive branch agencies of the government of Guam shall amortize p ayments for each municipal lease into equal monthly installment s throughout the fiscal year; provided, that any such amortizati on schedule for its respective municipal lease does not contravene the provisions of any indenture such that it would cause default o r any other negative impact to the credit rating of the governm ent of Guam. SOURCE: Added by P.L. 34-035:2 (July 13, 2017).

travene the provisions of any indenture such that it would cause default o r any other negative impact to the credit rating of the governm ent of Guam. SOURCE: Added by P.L. 34-035:2 (July 13, 2017). ---------- ARTICLE 5 INTEREST ON LATE PAYMENTS BY THE GOVERNMENT COL4/6/20225 GCA GOVERNMENT OPERATIONS CH. 22 GENERAL FISCAL POLICIES AND CONTROLS 84 SOURCE : The Prompt Payment Act was enacted by P.L. 18-040 :25-26. § 22501. Title: Prompt Payment Act. § 22502. Definitions. § 22503. Interest Penalties. § 22504. Limitation on Discount Payments. § 22505. Rules and Regulations. § 22506. Claims: Relation to Other Laws. § 22507. Legislative Oversight. § 22501. Title: Prompt Payment Act. Sections 22502-22507 of this Article may be cited as the Prompt Payment Act. § 22502. Definitions. As used in this Article: (a) Government agency means a department, agency, bureau or instrumentality of the Executive Branch o f the government of Guam. (b) Business means a business as defined in Subsect ion (c) of § 16002 of the Government Code. (c) Food product means meat and meat products, fish and shellfish, edible fresh or frozen poultry, poul try meat products, fresh eggs and perishable egg products.

) of § 16002 of the Government Code. (c) Food product means meat and meat products, fish and shellfish, edible fresh or frozen poultry, poul try meat products, fresh eggs and perishable egg products. (d) Perishable agricultural commodity means groceri es, vegetables, fresh fruit and other perishables. § 22503. Interest Penalties. (a) Each government agency which receives property or services from a business but which does not make pa yment for each such complete delivered item of property or service by the required payment date, shall pay an interest penalty to such business on the amount of the payment which is due as specified in this Article. (b) Interest penalties on amount due to a business under this Article shall be paid to the business for the perio d beginning on the day after the required payment date and ending on the date on which payment of the amount due is made, except tha t no interest COL4/6/20225 GCA GOVERNMENT OPERATIONS CH. 22 GENERAL FISCAL POLICIES AND CONTROLS 85 penalty shall be paid if payment for complete deliv ered item of property or service is made on or before the fiftee nth day after the required payment date, in the case of a food produc t; or the

85 penalty shall be paid if payment for complete deliv ered item of property or service is made on or before the fiftee nth day after the required payment date, in the case of a food produc t; or the thirtieth day after the required payment date in th e case of a perishable agricultural commodity; or the forty-fif th day after the required payment date, in the case of any other ite m. Interest shall be computed at the same interest rate assessed on u npaid income taxes owed by taxpayers. (c) Any amount of an interest penalty which remains unpaid at the end of any thirty-day period shall be added to the principle amount of the debt and thereafter interest penaltie s shall accrue on such added amount. (d) There is hereby authorized to be appropriated s uch sums as are necessary for the payment of interest penalt ies required by this Section. § 22504. Limitation on Discount Payments. (a) If a business offers a government agency a dis count from the amount otherwise due under a contract for prope rty or services in exchange for payment within such specified perio d of time, the government agency may make payment in an amount equ al to the discounted price only if payment is made

act for prope rty or services in exchange for payment within such specified perio d of time, the government agency may make payment in an amount equ al to the discounted price only if payment is made within suc h specified period of time. (b) Each government agency which violates Subsecti on (a) of this Section shall pay an interest penalty on an y amount which remains unpaid in violation of that Subsection. Suc h interest penalty shall accrue on such unpaid amount in accor dance with regulations prescribed pursuant to § 22505 of this Article except that the required payment date for such unpaid amou nt shall be the last day of the specified period of time described in Subsection (a) of this Section. § 22505. Rules and Regulations. The Director of the Department of Administration s hall promulgate rules and regulations in accordance with the Administrative Adjudication Law and this Article. S uch regulations shall specify: COL4/6/20225 GCA GOVERNMENT OPERATIONS CH. 22 GENERAL FISCAL POLICIES AND CONTROLS 86 (a) that for any property or services not covered b y items (b), (c) and (d) of this Section, the required paym ent date shall be the date on which payment is due under the

L POLICIES AND CONTROLS 86 (a) that for any property or services not covered b y items (b), (c) and (d) of this Section, the required paym ent date shall be the date on which payment is due under the terms of the contract for the provision of such property or service; or, if a specific date on which payment is due is not e stablished by contract or by items (b), (c) and (d) of this Se ction, thirty (30) days after receipt of a proper invoice for the amount of the payment; and (b) in the case of an acquisition of food product, a required payment date which is not later than fifte en (15) days after the date of delivery of such food produc t; and (c) in case of an acquisition of a perishable agric ultural commodity, a required payment date; and (d) in the case of a contract under which property or services are provided in a series of partial execut ions or deliveries, to the extent that such contract provid es for separate payment for such partial execution or deli very, such separate payment dates shall be the required paymen t dates; and (e) a requirement that, within fifteen (15) days th e date on which an invoice is received, that a government agency notify the business of any

payment dates shall be the required paymen t dates; and (e) a requirement that, within fifteen (15) days th e date on which an invoice is received, that a government agency notify the business of any defect or impropriety in such invoice which would prevent the running of the time period specified in items (a), (b), (c) or (d) of this Sec tion. § 22506. Claims: Relation to Other Laws. (a) Claims for interest penalties which a governme nt agency has failed to pay in accordance with the requiremen ts of § 22503 or § 22504 of this Chapter may be filed under statu tes governing contract disputes with the government of Guam. (b) Interest penalties under this Article shall no t continue to accrue after the filing of a claim for such penalti es, or for more than one (1) year, whichever comes first. (c) Except as provided in § 22504 of this Article regarding disputes concerning discounts, this Article shall n ot be construed to require interest penalties on payments which are not made by the required payment date by reason of a good faith dispute COL4/6/20225 GCA GOVERNMENT OPERATIONS CH. 22 GENERAL FISCAL POLICIES AND CONTROLS 87 between a government agency and a business over the amount

equired payment date by reason of a good faith dispute COL4/6/20225 GCA GOVERNMENT OPERATIONS CH. 22 GENERAL FISCAL POLICIES AND CONTROLS 87 between a government agency and a business over the amount of that payment or other allegations concerning compli ance with a contract. Claims concerning any such dispute, and a ny interest which may be payable for the period while the dispu te is being resolved, shall be subject to appropriate statutes governing contract disputes with the Government. § 22507. Legislative Oversight. (a) Each government agency shall file with the Leg islature a detailed report of any interest penalty payments ma de pursuant to this Article during the preceding fiscal year. (b) The report required by Subsection (a) of this Section shall include the number, accounts, frequency of interest penalty payments and the reasons such payments were not avo ided by prompt payment and shall be delivered to the Legisl ature within sixty (60) days after the conclusion of each fiscal year. (c) The Director of the Department of Administrati on shall submit a report to the Legislature on government ag ency compliance with the requirements of this Article wi thin one hundred

fiscal year. (c) The Director of the Department of Administrati on shall submit a report to the Legislature on government ag ency compliance with the requirements of this Article wi thin one hundred twenty (120) days after the conclusion of e ach fiscal year. ---------- ARTICLE 6 CONTRACTS § 22601. Execution of Contracts. § 22602. Copy of Contracts to Dept. of Administrati on. § 22603. Contracts & Purchase Orders for Next Fisca l Period. § 22604. Contracts with U.S. for Services. § 22601. Execution of Contracts. All contracts shall, after approval of the Attorney General, be submitted to the Governor for his signature. All co ntracts of whatever nature shall be executed upon the approval of the G overnor. SOURCE : GC § 6107. CROSS-REFERENCES : For execution of contracts made pursuant to the Procurement Law, see 5 GCA § 5121. COL4/6/20225 GCA GOVERNMENT OPERATIONS CH. 22 GENERAL FISCAL POLICIES AND CONTROLS 88 § 22602. Copy of Contracts to Dept. of Administrati on. A copy of any contract under which a payment may be made shall be submitted to the Department of Administrat ion for filing, recording and registration.

Copy of Contracts to Dept. of Administrati on. A copy of any contract under which a payment may be made shall be submitted to the Department of Administrat ion for filing, recording and registration. The Director of Adminis tration shall cause a register to be kept of all such contracts w ith subsequent amendments, which register shall be open and availa ble for public inspection during normal working hours. Certified c opies of such contract with subsequent amendments may be obtained after paying the fee therefor set out in of this Chapter. No suc h contracts or amendments thereto shall be deemed valid or enforce able until it shall have been so submitted to the Department of Adminis tration and enrolled on the public register. SOURCE : GC § 6108 amended by P.L. 12-159. NOTE : Prior § 6108 did not hinge validity of contracts on filing and registration. This amendment became effective on No vember 28, 1973 and applied only to contracts executed after that date. § 22603. Contracts & Purchase Orders for Next Fisca l Period. Whenever appropriations have been made for any fisc al year, contracts and purchase orders may be executed and c harged against such appropriations at any time

urchase Orders for Next Fisca l Period. Whenever appropriations have been made for any fisc al year, contracts and purchase orders may be executed and c harged against such appropriations at any time prior to the beginn ing of the fiscal year; provided, however, that no payments shall be made pursuant to such contracts or purchase orders prior to the fisc al year for which such appropriations are made. SOURCE : GC § 6115. § 22604. Contracts with U.S. for Services. I Maga’lahi (the Governor) is authorized to enter into agreements with the United States of America, or an y agency or instrumentality thereof, for the furnishing by the government of Guam of services, including labor and use of equipm ent, on a reimbursable basis. All proceeds derived from such agreements shall be paid into the General Fund of the government of Guam, except that to the extent such services are furnished by t he Jose D. Leon Guerrero Commercial Port of Guam or the Guam Waterw orks Authority, and the Guam Power Authority, reimbursem ent shall be paid into the treasuries of the respective agencies . SOURCE : GC § 6117 added by P.L. 6-57. Repealed and Reena cted by P.L. 27-110:5.

Authority, and the Guam Power Authority, reimbursem ent shall be paid into the treasuries of the respective agencies . SOURCE : GC § 6117 added by P.L. 6-57. Repealed and Reena cted by P.L. 27-110:5. COL4/6/20225 GCA GOVERNMENT OPERATIONS CH. 22 GENERAL FISCAL POLICIES AND CONTROLS 89 COMMENT : This § 22604 has not been amended since its adopt ion, despite the fact that neither the Commercial Port, nor the Public Utilities Division of the Dept. of Public Works, nor their re spective funds, exist. All functions referred to in the original law have been taken over by the respective authorities, now autonomous agencies. Th e Compiler presumes that other autonomous agencies providing services, such as the Guam Airport Authority, will receive reimbursement into their own funds, in accordance with their own powers. Guam did not have a civilian airport in 1962, when this law was enacted. ---------- ARTICLE 7 GENERAL PROPERTY CONTROL § 22701. Property Loss or Damage. § 22702. Property Survey. § 22703. Exemption from § 22702; Law Library Donati ons. § 22704. Acquisition of Office Space & Other Facili ties. § 22705. Release of Working Animals from Government Service. § 22701.

operty Survey. § 22703. Exemption from § 22702; Law Library Donati ons. § 22704. Acquisition of Office Space & Other Facili ties. § 22705. Release of Working Animals from Government Service. § 22701. Property Loss or Damage. An officer or agent responsible under the governme nt for property will be charged for any damage (beyond ord inary wear and tear) or loss, or destruction of the same, unle ss he shows to the satisfaction of the Director of Administration, by affidavit or depositions, or by report of a board of survey, tha t the damage, loss or destruction was occasioned by unavoidable c auses, without fault or neglect on his part. SOURCE : GC § 6109. § 22702. Property Survey. (a) There is within the government of Guam a Board of Survey which shall be composed of five members appo inted by the Governor with the advice and consent of the Leg islature. The Board of Survey shall meet within fifteen days afte r preparation of a listing of surplus and lost property. No membe r shall be an employee of the government of Guam. No member shall receive compensation for his services on the Board of Surve y. No member shall purchase or obtain surplus property upon its disposition.

hall be an employee of the government of Guam. No member shall receive compensation for his services on the Board of Surve y. No member shall purchase or obtain surplus property upon its disposition. No COL4/6/20225 GCA GOVERNMENT OPERATIONS CH. 22 GENERAL FISCAL POLICIES AND CONTROLS 90 entity, charitable or for profit, in which a member is actively involved shall become eligible to purchase or obtai n surplus property upon its disposition. Three members of the Board shall constitute a quorum and a majority of those present may take action on behalf of the Board. (b) On the second Monday of each Quarter, each dep artment administrator whose department has surplus or lost property shall provide the Director of Administration with a list of all personal property which has been disposed of in accordance w ith § 22703 of this Article, become unserviceable through wear and tear, obsolescence or otherwise, or how been lost. On the third Monday of each Quarter, the Director of Administration sha ll promulgate a listing of all surplus and lost property and dist ribute it to each department or agency within the government of Guam.

hird Monday of each Quarter, the Director of Administration sha ll promulgate a listing of all surplus and lost property and dist ribute it to each department or agency within the government of Guam. Any department or agency may request transfer of the su rplus property to it at no cost. The request for transfer shall in dicate the intended use for such property. The Guam Community College a nd the Department of Vocational Rehabilitation may be requ ested to repair property if the property can be restored to use at a reasonable rate, provided, that no property shall b e repaired or restored if the cost exceeds 65% of the value of th e property. (c) The Board of Survey shall authorize the transf er of property among agencies and departments of the gove rnment of Guam. If costs of repair have been incurred, then t he acquiring agency shall pay such costs. (d) If a department of agency proposed to use surp lus property as a trade-in, then the Board of Survey sh all approve the terms of the trade-in including the amount of the a llowance. (e) Property not disposed of by transfer or trade- in shall be sold as follows: (1) Property with an acquisition cost of less than $1,000 or with an

e trade-in including the amount of the a llowance. (e) Property not disposed of by transfer or trade- in shall be sold as follows: (1) Property with an acquisition cost of less than $1,000 or with an acquisition cost of more than $1,000 wit h a fair market value at the time of disposal of less than $ 500 maybe sold at fixed prices as determined by the Board at a surplus sale operated by the Department of Administration a nd open to the public at specified dates and times. COL4/6/20225 GCA GOVERNMENT OPERATIONS CH. 22 GENERAL FISCAL POLICIES AND CONTROLS 91 (2) Property with an acquisition cost of more than $1,000 and with a fair market value at the time of disposal of more than $500 shall be sold to the highest bidder at an auction which has been advertised to the public mor e than 10 days in advance of such sale. (3) All money received from such sale shall be depo sited in the General Fund. (f) Property which has not been transferred, trade d in or sold after 60 days may be donated to a local charitable, social or civil association on a first come first served basis, or disposed of in any other way possible.

not been transferred, trade d in or sold after 60 days may be donated to a local charitable, social or civil association on a first come first served basis, or disposed of in any other way possible. (g) If the property has been lost, then the Board of Survey shall review the circumstances of the loss, determi ne if the loss was due to the negligence of any employee and autho rize the removal of the property from official government re cords. If the loss occurred because of the negligence of any empl oyee, then the Board shall refer the matter to the Attorney Genera l to pursue recovery of the loss. (h) The provisions of this Section shall be applic able to the Executive, Legislative, and Judicial Branches of th e Government unless the property is subject to disposal by Feder al law. SOURCE : GC § 6110 added by P.L. 10-72; amended by P.L. 16 -61. CROSS-REFERENCES : This section does not apply to surplus supplies, the definition and disposition of which are covered in 5 GCA § 5403 as part of the Procurement Law. § 22703. Exemption from § 22702; Law Library Donati ons. Notwithstanding the provisions of § 22702 of this Article, rules and regulations promulgated thereunder, or an y

part of the Procurement Law. § 22703. Exemption from § 22702; Law Library Donati ons. Notwithstanding the provisions of § 22702 of this Article, rules and regulations promulgated thereunder, or an y other law or administrative provision, any agency, department, o r instrumentality of the government of Guam is author ized to donate books or other educational materials to the Guam La w Library. SOURCE : GC § 6110.1 added by P.L. 15-24:13. 2016 NOTE: Reference to the 'Territorial Law Library' change d to 'Guam Law Library' pursuant to 1 GCA § 420. § 22704. Acquisition of Office Space & Other Facili ties. COL4/6/20225 GCA GOVERNMENT OPERATIONS CH. 22 GENERAL FISCAL POLICIES AND CONTROLS 92 (a) The Governor is authorized to acquire on behalf of the government of Guam, by lease or lease-purchase agre ement, office space and other facilities for the purpose o f providing office and other space for the departments and agencies of the Judicial and Executive Branches of the government of Guam. S uch leases and lease-purchase agreements may be negotiated and entered into by the Governor with any person, partnership, corpo ration, or public or private entity, provided that no such lea se or

S uch leases and lease-purchase agreements may be negotiated and entered into by the Governor with any person, partnership, corpo ration, or public or private entity, provided that no such lea se or lease- purchase agreement shall exceed 50 years. (b) The Governor is further authorized to sublease space and facilities acquired pursuant to (a) hereof, and to lease other available space and facilities, to authorized feder al agencies. (c) All lease or lease-purchase agreements that ar e proposed to be entered into pursuant to (a) hereof, where th e total sum of money to be paid to the same lessor shall exceed $1 0,000 or the total number of years involved shall exceed five ye ars, may be entered into only after advertising for sealed bids in a newspaper of general circulation within Guam, 14 days prior t o the formal bid opening, and then only to the lowest responsibl e bidder. SOURCE : GC § 6116. 2018 NOTE: References to 'Territory' and 'territorial' removed and/or altered to 'Guam' pursuant to 1 GCA § 420. § 22705. Release of Working Animals from Government Service. (a) Availability for Adoption.

NOTE: References to 'Territory' and 'territorial' removed and/or altered to 'Guam' pursuant to 1 GCA § 420. § 22705. Release of Working Animals from Government Service. (a) Availability for Adoption. The Director of the Agency concerned may make a working animal of such Agency available for adoption by a person or entity referred to in S ubsection (c), unless the animal has been determined to be unsuita ble for adoption under Subsection (b), under the circumstan ces as follows: (1) at the end of the animal’s useful life; (2) before the end of the animal’s useful life, if such Director, in such Director’s discretion, determines that unusual or extraordinary circumstances justify maki ng the animal available for adoption before that time; or (3) when the animal is otherwise excess to the need s of COL4/6/20225 GCA GOVERNMENT OPERATIONS CH. 22 GENERAL FISCAL POLICIES AND CONTROLS 93 such Agency. (b) Suitability for Adoption. The decision whether a particular animal is suitable or unsuitable for ado ption under this Section shall be made by the Leader of the last Uni t to which the animal is assigned before being declared excess.

sion whether a particular animal is suitable or unsuitable for ado ption under this Section shall be made by the Leader of the last Uni t to which the animal is assigned before being declared excess. Th e Unit Leader shall consider the recommendations of the Unit’s ve terinarian, a certified behaviorist, or other competent authority in making the decision regarding the adoptability of the animal. (c) Authorized Recipients. The working animals may be adopted under this Section by law enforcement agenc ies, former handlers of these animals, or other persons capable of humanely caring for these animals. (d) Consideration. The transfer of a working animal under this Section may be without charge to the recipient . (e) Limitations on Liability for Transferred Animal s. (1) Notwithstanding any other provision of law, the government of Guam shall not be subject to any suit , claim, demand or action, liability, judgment, cost or othe r fee arising out of any claim for personal injury or property da mage, including death, illness, or loss of or damage to p roperty or other economic loss, that results from, or is in an y manner predicated upon, the act or omission of a former wo rking

property da mage, including death, illness, or loss of or damage to p roperty or other economic loss, that results from, or is in an y manner predicated upon, the act or omission of a former wo rking animal transferred under this Section, including an y training provided to the animal while a working animal. (2) Notwithstanding any other provision of law, the government of Guam shall not be liable for any vete rinary expense associated with a working animal transferre d under this Section for a condition of the working animal before transfer under this Section, whether or not such co ndition is known at the time of transfer under this Section. (f) Annual Report. The Director of the Agency shall submit to the Speaker of I Liheslaturan Guåhan an annual report specifying the number of working animals adopted un der this Section during the preceding year, the number of wo rking animals currently awaiting adoption, and the number of work ing animals euthanized during the preceding year. With respect to each COL4/6/20225 GCA GOVERNMENT OPERATIONS CH. 22 GENERAL FISCAL POLICIES AND CONTROLS 94 euthanized working animal, the report shall contain an explanation of the reason(s) why the

With respect to each COL4/6/20225 GCA GOVERNMENT OPERATIONS CH. 22 GENERAL FISCAL POLICIES AND CONTROLS 94 euthanized working animal, the report shall contain an explanation of the reason(s) why the animal was eut hanized, rather than retained for adoption under this Sectio n. (g) Definitions. For the purposes of this Section: (1) Agency means the Guam Police Department, the Department of Corrections, the A.B. Won Pat Interna tional Airport Authority, or the Customs and Quarantine Ag ency; (2) Director means the Chief of the Guam Police Department, Director of the Department of Correctio ns, the General Manager of the A.B. Won Pat International A irport Authority, or the Director of the Customs and Quara ntine Agency; (3) Working animal means a working dog for the Agency; (4) Unit means an operational division of the Agenc y; and (5) Leader means the chief officer in the Unit. SOURCE : Added by P.L. 31-219:2 (June 15, 2012). ---------- ARTICLE 8 TAX REFUND BONDS SOURCE: Added by P.L. No. 22-138:1 (Aug. 19, 1994) as 5 G CA § 22440. Codified by the Compiler as Article 8 and renumbered to adhere to the Compiler’s alpha-numeric scheme in ac cordance to 1 GCA § 1606. § 22801.

by P.L. No. 22-138:1 (Aug. 19, 1994) as 5 G CA § 22440. Codified by the Compiler as Article 8 and renumbered to adhere to the Compiler’s alpha-numeric scheme in ac cordance to 1 GCA § 1606. § 22801. Tax and Revenue Anticipation Bonds or Bank Loans; Authorization of Issuance of Bonds or Making of Loans to Pay Refunds. § 22802. Bonds; Size of Issue. § 22803. Terms and Conditions of the Bonds; Governo r’s Certificate. § 22804. Valid and Binding General Obligation; Pled ge of Revenues. COL4/6/20225 GCA GOVERNMENT OPERATIONS CH. 22 GENERAL FISCAL POLICIES AND CONTROLS 95 § 22805. Appropriation From the General Fund. § 22806. Additional Bonds. § 22807. Waiver of Immunity. § 22808. Form of Bonds; Covenants; Appointment of Fiduciaries. § 22809. Authorization for Credit Enhancement. § 22810. Use of Proceeds from the Sale of the Bonds . § 22811. No Personal Liability. § 22812. Selection of Participants. § 22813. Approval of GEDA. § 22814. Local Sale of Bonds. § 22815. Authorization for Loans. § 22816. Valid and Binding General Obligations; Ple dge of Revenues. § 22817. Appropriation from the General Fund. § 22818. Waiver of Immunity. § 22819. Form of Loans. § 22820.

thorization for Loans. § 22816. Valid and Binding General Obligations; Ple dge of Revenues. § 22817. Appropriation from the General Fund. § 22818. Waiver of Immunity. § 22819. Form of Loans. § 22820. Use of Proceeds from the Loans. § 22821. No Personal Liability. § 22822. Approval of GEDA. § 22823. Either Bonds or Loans. § 22824. Maximum Borrowing. § 22825. Excess Proceeds. § 22801. Tax and Revenue Anticipation Bonds or Bank Loans; Authorization of Issuance of Bonds or Making of Loa ns to Pay Refunds. In order to fund the payment of income tax refunds due to local taxpayers, the Governor of Guam is authorized to either (i) enter into one (1) or more loan agreements with loc al banks, as provided in § 22825, or (ii) issue one (1) or more series of general obligation bonds of the government of Guam (the 'Bo nds'), in anticipation of the receipt of taxes and other reve nue. § 22802. Bonds; Size of Issue. The Bonds shall have an aggregate principal amount at any one time outstanding not to exceed Forty-Five Milli on Dollars ($45,000,000); provided, however, that the issuance of the Bonds shall not cause a violation of the debt limitation provisions of the COL4/6/20225 GCA GOVERNMENT

to exceed Forty-Five Milli on Dollars ($45,000,000); provided, however, that the issuance of the Bonds shall not cause a violation of the debt limitation provisions of the COL4/6/20225 GCA GOVERNMENT OPERATIONS CH. 22 GENERAL FISCAL POLICIES AND CONTROLS 96 Organic Act of Guam (48 U.S.C. 1423a). The Bonds ma y be issued and the proceeds expended to allow the gover nment of Guam to pay for the cost of their issuance and disc harge its obligation to pay refunds owed to taxpayers who hav e filed their income tax forms with the government of Guam in acc ordance with the Organic Act of Guam. § 22803. Terms and Conditions of the Bonds; Governo r’s Certificate. The Governor has assured the Legislature that inte rest rates in the nation’s capital markets are more favorable than the current six per cent (6%) required to be paid on income tax refunds owed, and that such rates vary between three and nine-ten ths percent (3.9%) and five and three-quarters percent (5.75%). In the event the Governor elects to issue the Bonds their terms and conditions shall be determined by the Governor upon or prior t o their issuance by his execution of a certificate authoriz ing such issuance.

nt the Governor elects to issue the Bonds their terms and conditions shall be determined by the Governor upon or prior t o their issuance by his execution of a certificate authoriz ing such issuance. The certificate shall contain such terms and conditions as are consistent with this § 22811. The Bonds shal l mature at such times as are not later than sixty (60) months after the date of their issuance, and shall bear interest at a fixed or var iable rate, not exceeding a net effective yield of seven percent (7 %) per annum. § 22804. Valid and Binding General Obligation; Pled ge of Revenues. Any Bonds authorized by this § 22811 shall constit ute valid and binding general obligations of the government o f Guam, which pledges its full faith and credit for the pun ctual payment of both principal of and interest on the Bonds. There shall be collected annually in the same manner and at the sa me time as government revenue for other purposes is collected, such sum as is required to pay the principal of and interest on the Bonds. All officers charged by law with any duty in the collec tion of the revenues of the government of Guam shall do every l awful thing necessary to collect such sum.

ncipal of and interest on the Bonds. All officers charged by law with any duty in the collec tion of the revenues of the government of Guam shall do every l awful thing necessary to collect such sum. In addition, all or part of the revenues derived by the government of Guam under Se ction 30 of the Organic Act of Guam may, if determined by the G overnor to be necessary or desirable, be pledged to secure the repayment of any Bonds issued under this § 22811 and to pay the costs incurred in their issuance or administration. Any pledge mad e to secure the COL4/6/20225 GCA GOVERNMENT OPERATIONS CH. 22 GENERAL FISCAL POLICIES AND CONTROLS 97 Bonds shall be valid and binding for the term of th e pledge. The revenues pledged and thereafter received by the gov ernment of Guam or by any trustee, depository or custodian sha ll be deposited in a separate account and shall be immediately subj ect to the lien of such pledge without physical delivery thereof or further act, and the lien of such pledge shall be valid and binding against all parties having claims of any kind in tort, contract or othe rwise against the government of Guam or against such trustee, deposit ory or custodian,

such pledge shall be valid and binding against all parties having claims of any kind in tort, contract or othe rwise against the government of Guam or against such trustee, deposit ory or custodian, irrespective of whether the parties have notice thereof. The certificate or agreement by which such pledge i s created need not be recorded. All such revenues, to the extent s o pledged, are hereby continuously appropriated for such purpose. § 22805. Appropriation from the General Fund. There are hereby appropriated from the General Fun d such sums as will equal in each year the amount of money necessary to pay the principal of and interest on the Bonds. § 22806. Additional Bonds. Nothing in this § 22811 shall be construed to prev ent the government of Guam from issuing, pursuant to approp riate enabling legislation, other obligations of the gove rnment secured with the Bonds by the general obligation of the gov ernment on a parity with the Bonds authorized by this § 22811. § 22807. Waiver of Immunity. Notwithstanding any substantive or procedural prov ision of Chapter 6, Title 5, Guam Code Annotated, the govern ment of Guam hereby waives immunity from any suit or action in contract

er of Immunity. Notwithstanding any substantive or procedural prov ision of Chapter 6, Title 5, Guam Code Annotated, the govern ment of Guam hereby waives immunity from any suit or action in contract on the Bonds, but does not waive sovereign immunity as to the personal liability of elected or appointed official s and employees of the government of Guam. § 22808. Form of Bonds; Covenants; Appointment of F iducia- ries. The technical form and language of the Bonds inclu ding provisions for execution, exchange, transfer, regis tration, paying agency, lost or mutilated Bonds, negotiability, can cellation and other terms or conditions not inconsistent with thi s § 22811, shall be as specified in the certificate executed by the Governor COL4/6/20225 GCA GOVERNMENT OPERATIONS CH. 22 GENERAL FISCAL POLICIES AND CONTROLS 98 authorizing their issuance. The certificate may con tain the appointment by the Governor of one (1) or more trus tees or other fiduciaries authorized to receive and hold in trust the proceeds of the Bonds, and moneys relating thereto, to protect the rights of the bondholders and to perform such other duties as may be specified in the certificate.

to receive and hold in trust the proceeds of the Bonds, and moneys relating thereto, to protect the rights of the bondholders and to perform such other duties as may be specified in the certificate. The Governor is also authorized to execute, on behalf of the government of Guam, any appropriate a greements, certificates or other instruments relating to the B onds and their sale. § 22809. Authorization for Credit Enhancement. The Governor is authorized to enter into such cont racts or agreements with such banks, insurance companies or other financial institutions as he determines are necessa ry or desirable to improve the security and marketability of the Bo nds issued under this § 22811. Such contracts or agreements ma y contain an obligation to reimburse, with interest, any such ba nks, insurance companies or other financial institution for advanc es used to pay principal of or interest on the Bonds. Any such rei mbursement obligation shall be a general obligation of the gov ernment of Guam and any such advance, if necessary, shall be t reated as creating a reimbursement obligation issued to refun d the Bonds. § 22810. Use of Proceeds from the Sale of the Bonds .

the gov ernment of Guam and any such advance, if necessary, shall be t reated as creating a reimbursement obligation issued to refun d the Bonds. § 22810. Use of Proceeds from the Sale of the Bonds . Proceeds from the sale of the Bonds shall be used for the purpose for which the government of Guam is authori zed to use and expend moneys as set forth in § 22812 and for p ayment of expenses relating to the authorization, sale and is suance of the Bonds, including, without limitation, printing cost s, costs of reproducing documents, bond insurance premiums, und erwriting, legal and accounting fees and charges, fees paid to banks or other financial institution providing credit enhancement, costs of credit ratings, fees and charges for execution, transporta tion and safekeeping of Bonds and other costs, charges and f ees in connection with the issuance, sale and delivery of the Bonds. Fees charged by the Guam Economic Development Authority (GEDA) for a bond issuance are hereby waived. § 22811. No Personal Liability. COL4/6/20225 GCA GOVERNMENT OPERATIONS CH. 22 GENERAL FISCAL POLICIES AND CONTROLS 99 No employee or appointed or elected official of th e government of Guam shall be

§ 22811. No Personal Liability. COL4/6/20225 GCA GOVERNMENT OPERATIONS CH. 22 GENERAL FISCAL POLICIES AND CONTROLS 99 No employee or appointed or elected official of th e government of Guam shall be individually or persona lly liable for the payment of any amounts due on any of the Bonds issued under this § 22811, or for any other liability arising in connection with the Bonds; provided, however, that nothing in this § 22821 shall relieve any employee or appointed or elected offici al from the performance of any ministerial duty required by law . § 22812. Selection of Participants. In view of the urgency for the issuance of the Bon ds, at any time such issuance may be necessary, the Governor i s hereby authorized to utilize such method as he deems appro priate for the selection of all participants in connection with th e issuance and sale of the Bonds, including trustees, paying agent s, underwriters, counsel, any credit enhancement provider and any ot her participants; provided, however, that such selectio n shall be subject to any provision of law which requires bidd ing, other competitive process, or any other procedure with re spect to such selection, except the Governor may

ever, that such selectio n shall be subject to any provision of law which requires bidd ing, other competitive process, or any other procedure with re spect to such selection, except the Governor may limit the reques ts for proposals for services associated with the issuance of the Bonds to those firms that have previously participated in bond issues for Guam. § 22813. Approval of GEDA. Subparagraph (k) of § 2103 of Title 12, Guam Code Annotated, provides that agencies and instrumentali ties of the government of Guam shall issue obligations only by means of and through the agency of GEDA, and that GEDA shall not sell any obligation without the approval of the Legislature on its terms and conditions. In view of the urgency for the issuance of the Bonds, at any time such issuance may be necessary, the Bon ds issued hereunder are hereby exempted from the requirement of said subparagraph (k) that the Legislature further appro ve the terms and conditions of the issuance of the Bonds. § 22814. Local Sale of Bonds. The Governor of Guam shall undertake his best effo rts to cause a portion of any Bonds issued pursuant to thi s § 22811 to be offered for sale in Guam, if and to the extent

2814. Local Sale of Bonds. The Governor of Guam shall undertake his best effo rts to cause a portion of any Bonds issued pursuant to thi s § 22811 to be offered for sale in Guam, if and to the extent that such offer and COL4/6/20225 GCA GOVERNMENT OPERATIONS CH. 22 GENERAL FISCAL POLICIES AND CONTROLS 100 any sales resulting from such offer do not increase the cost to the government of Guam of issuing and repaying the Bond s. § 22815. Authorization for Loans. As authorized in this § 22811, the Governor is auth orized to enter into loan agreements with local banks for the purpose of paying income tax refunds owed to taxpayers (the Lo ans). The terms and conditions of the Loans shall be as negot iated by the Governor except that (a) the interest rate thereon shall not exceed a ne t effective yield of seven percent (7%) per annum, (b) the term of the Loans shall not exceed sixty (6 0) months, and (c) interest on the Loans shall be exempt from taxa tion by the government of Guam. 2013 NOTE: Pursuant to the authority granted by 1 GCA § 1606 , numbers and/or letters were altered to adhere to the Compil er’s alpha-numeric scheme. § 22816.

rom taxa tion by the government of Guam. 2013 NOTE: Pursuant to the authority granted by 1 GCA § 1606 , numbers and/or letters were altered to adhere to the Compil er’s alpha-numeric scheme. § 22816. Valid and Binding General Obligations; Ple dge of Revenues. The Loans authorized by this § 22811 shall constitu te valid and binding general obligations of the government o f Guam, which pledges its full faith and credit for the pun ctual payment of both principal of and interest on the Loans. There shall be collected annually in the same manner and at the sa me time as government revenue for other purposes is collected, such sum as is required to pay the principal of and interest on the Loans. All officers charged by law with any duty in the collec tion of the revenues of the government shall do every lawful th ing necessary to collect such sum. In addition, all or part of the revenues derived by the government of Guam under Section 30 of the Organic Act of Guam may, if determined by the Governor to be neces sary or desirable, be pledged to secure the repayment of th e Loans and to pay the costs incurred in their issuance or adminis tration.

anic Act of Guam may, if determined by the Governor to be neces sary or desirable, be pledged to secure the repayment of th e Loans and to pay the costs incurred in their issuance or adminis tration. Any pledge made to secure the Loans shall be valid and binding for the term of the pledge. The revenues pledged and therea fter received COL4/6/20225 GCA GOVERNMENT OPERATIONS CH. 22 GENERAL FISCAL POLICIES AND CONTROLS 101 by the government of Guam or by any trustee, deposi tory or custodian shall be deposited in a separate account and shall be immediately subject to the lien of such pledge with out physical delivery thereof or further act, and the lien of su ch pledge shall be valid and binding against all parties having claims of any kind in tort, contract or otherwise against the government of Guam or such trustee, depository or custodian, irrespective of whether the parties have notice thereof. The certificate or agr eement by which such pledge is created need not be recorded. All su ch revenues, to the extent so pledged, are hereby continuously appr opriated for such purpose. § 22817. Appropriation from the General Fund.

which such pledge is created need not be recorded. All su ch revenues, to the extent so pledged, are hereby continuously appr opriated for such purpose. § 22817. Appropriation from the General Fund. There are hereby appropriated from the General Fun d such sums as will equal in each year the amount of money necessary to pay the principal of and interest on the Loans. § 22818. Waiver of Immunity. Notwithstanding any substantive or procedural prov ision of Chapter 6, Title 5, Guam Code Annotated, the govern ment of Guam hereby waives immunity from any suit or action in contract on the Loans, but does not waive sovereign immunity as to the personal liability of elected or appointed official s and employees of the government of Guam. § 22819. Form of Loans. The form and language of the loan agreements suppo rting the Loans including provisions for execution, negotiabi lity, termination, defaults, and other terms or condition s not inconsistent with this § 22811, shall be as negotia ted by the Governor authorizing their execution. The Governor is authorized to execute, on behalf of the government of Guam, th e loan agreements and any other appropriate agreements, ce rtificates or

ed by the Governor authorizing their execution. The Governor is authorized to execute, on behalf of the government of Guam, th e loan agreements and any other appropriate agreements, ce rtificates or other instruments relating to the Loans and their p ayment. § 22820. Use of Proceeds from the Loans. Proceeds from the Loans shall be used for the purp ose for which the government of Guam is authorized to use a nd expend moneys as set forth in § 22812 and for payment of e xpenses relating to the negotiation and execution of the Lo ans, including, COL4/6/20225 GCA GOVERNMENT OPERATIONS CH. 22 GENERAL FISCAL POLICIES AND CONTROLS 102 without limitation, costs of reproducing documents, legal and accounting fees and charges, commitment and other f ees paid to the lenders, costs of credit ratings, fees and othe r costs, charges and fees in connection with the execution and deliv ery of the Loans. § 22821. No Personal Liability. No employee or appointed or elected official of th e government of Guam shall be individually or persona lly liable for the payment of any amounts due on any of the Loans made under this § 22811, or for any other liability arising in connection with the Loans;

nt of Guam shall be individually or persona lly liable for the payment of any amounts due on any of the Loans made under this § 22811, or for any other liability arising in connection with the Loans; provided, however, that nothing in this § 22831 shall relieve any employee or appointed or elected offici al from the performance of any ministerial duty required by law . § 22822. Approval of GEDA. Subparagraph (k) of § 2103 of Title 12, Guam Code Annotated, provides that agencies and instrumentali ties of the government of Guam shall issue obligations only by means of and through the agency of GEDA, and that GEDA shall not sell any obligation without the approval of the Legislature on its terms and conditions. In view of the urgency for the executio n of the Loans, at any time such execution may be necessary, the Loans made hereunder are hereby exempted from the requirement of said subparagraph (k) that the Legislature further appro ve the terms and conditions of the issuance of the Loans. § 22823. Either Bonds or Loans. In paying the income tax refunds due to Guam taxpa yers, the government of Guam may utilize only one (1) of the two (2) alternatives authorized by this § 22811:

Loans. § 22823. Either Bonds or Loans. In paying the income tax refunds due to Guam taxpa yers, the government of Guam may utilize only one (1) of the two (2) alternatives authorized by this § 22811: Either the Bonds or the Loans, but not both, and shall choose that alternat ive that is determined to be the less expensive and the more ex peditious. § 22824. Maximum Borrowing. Whether the Bonds or the Loans are utilized, the m aximum borrowing under either shall not exceed Forty-Five Million Dollars ($45,000,000). § 22825. Excess Proceeds. COL4/6/20225 GCA GOVERNMENT OPERATIONS CH. 22 GENERAL FISCAL POLICIES AND CONTROLS 103 In the event the proceeds of either the Bonds or t he Loans are in excess of the amounts needed to pay all the tax refunds due and to pay for the costs of issuance and administration of such Bonds or Loans, such excess shall only be used to redeem the Bonds or to repay the Loans. NOTE : Sections .01, .0101, .0102, .0103, .0104, .0105, .0106, .0107, .0108, .0109, .0110, .0111, .011.2, .02, .0201, .02 02, .0203, .0204, .0205, .0206, .0207, .03, .04, and .05 have been changed t o §§ 22802, 224803, et seq.

.0102, .0103, .0104, .0105, .0106, .0107, .0108, .0109, .0110, .0111, .011.2, .02, .0201, .02 02, .0203, .0204, .0205, .0206, .0207, .03, .04, and .05 have been changed t o §§ 22802, 224803, et seq. The section numbers in the original bill were amended to reflect the current GCA format. Amended by Compiler in order to reflect the correct citation. ---------- ARTICLE 9 RAINY DAY FUND SOURCE : This Article was added as Article 8 by P.L. 22-02 4:7 (Aug. 31, 1993) and renumbered by Compiler. § 22901. Creation. § 22902. Separate Fund and Bank Account. § 22903. Purpose and Expenditures. § 22904. Deposits and Appropriations. § 22905. Administration. § 22906. Investment. § 22901. Creation. There is hereby created, separate and apart from th e other funds of the government of Guam, a reserve fund kno wn as the 'Rainy Day Fund.' § 22902. Separate Fund and Bank Account. The Rainy Day Fund shall not be commingled with the General Fund or any other fund of the government of Guam. The Rainy Day Fund shall be maintained in a separate ba nk account. § 22903. Purpose and Expenditures. The Rainy Day Fund shall be expended by appropriati on by law for the following purposes: COL4/6/20225 GCA

Day Fund shall be maintained in a separate ba nk account. § 22903. Purpose and Expenditures. The Rainy Day Fund shall be expended by appropriati on by law for the following purposes: COL4/6/20225 GCA GOVERNMENT OPERATIONS CH. 22 GENERAL FISCAL POLICIES AND CONTROLS 104 (a) eliminating or reducing any General Fund defici t existing at the end of a fiscal year substantially resulting from an unexpected, substantial decline in revenues rece ived or due to the General Fund; or (b) for expenses caused by a Guam emergency. No monies can be transferred from the Rainy Day Fund b y the Governor pursuant to her transfer authority. § 22904. Deposits and Appropriations. All funds appropriated pursuant to § 22436, Chapter 22, Title 5, Guam Code Annotated, shall be deposited in the R ainy Day Fund. However, no deposits to the Rainy Day Fund sh all be made if the Fund’s assets exceed ten percent (10%) of th e average gross operating requirements funded by the General Fund o ver the prior three (3) fiscal years. No expenditures from the Ra iny Day Fund shall be made that reduce the Rainy Day Fund below the said ten percent (10%) average of the gross operating requir ements funded by the General

fiscal years. No expenditures from the Ra iny Day Fund shall be made that reduce the Rainy Day Fund below the said ten percent (10%) average of the gross operating requir ements funded by the General Fund over the prior three (3) fiscal years. Expenditures from the Rainy Day Fund shall only be authorized by an appropriation or appropriations authorization by the I Liheslaturan Guåhan . 2020 NOTE: The requirement to deposit into the Rainy Day Fun d was suspended for Fiscal Year 2020 by P.L. 35-085:2 (Ap r. 28, 2020). § 22905. Administration. The Director of Administration shall account for an d administer the Rainy Day Fund. The Director shall k eep all books, records, files and accounts of the Rainy Day Fund. The Director shall prepare quarterly reports relative to the Rai ny Day Fund reflecting the transactions and the financial condi tion of the Rainy Day Fund, which quarterly reports shall be transmit ted to the Legislature and the Governor not later than thirty (30) days after the end of each quarter during the fiscal year. § 22906. Investment. The Director of Administration shall invest money held in the Rainy Day Fund in any type of investment approv ed for the Retirement

he end of each quarter during the fiscal year. § 22906. Investment. The Director of Administration shall invest money held in the Rainy Day Fund in any type of investment approv ed for the Retirement Fund. All proceeds and income from inves tments of the Rainy Day Fund shall be deposited in the Rainy Day Fund. COL4/6/20225 GCA GOVERNMENT OPERATIONS CH. 22 GENERAL FISCAL POLICIES AND CONTROLS 105 SOURCE: Added by P.L. 22-024:7 (Aug. 31, 1993). Repealed a nd reenacted by P.L. 29-002::VI:19 (May 18, 2007). Ame nded by P.L. 35- 036:XII:25 (Sept. 4, 2019). ---------- ARTICLE 10 LIMITED OBLIGATION INFRASTRUCTURE IMPROVEMENT BONDS SOURCE : Article added by P.L. 24-111:1 (Dec. 2, 1997). § 22950. Certain Definitions. § 22951. Authorization of Issuance of Limited Oblig ation Infrastructure Improvement Bonds. § 22952. Source of and Security for Payment of the Bonds. § 22953. Terms and Conditions Determined by Indentu re; Forms of Bonds; Covenants; Appointments of Fiduciaries; Other Related Agreements. § 22954. Authorization for Credit Enhancement. § 22955. Valid and Binding Obligations, Collection of Revenue. § 22956. Waiver of Immunity. § 22957. No Personal Liability. § 22957.1.

lated Agreements. § 22954. Authorization for Credit Enhancement. § 22955. Valid and Binding Obligations, Collection of Revenue. § 22956. Waiver of Immunity. § 22957. No Personal Liability. § 22957.1. Liability of Contractors and Project En gineers. § 22958. Infrastructure Improvement Projects. § 22959. Approval of Guam Economic Development Authority. § 22960. Approval of Terms and Conditions. § 22961. Permitted Investments. § 22962. Local Sale of Bonds. § 22950. Certain Definitions. The following terms shall have the following meanin gs when used in this Article: (a) Hotel tax revenues means all revenues derived f rom taxes of the type now imposed by § 30101 of Chapter 30 of Title 11 of the Guam Code Annotated. COL4/6/20225 GCA GOVERNMENT OPERATIONS CH. 22 GENERAL FISCAL POLICIES AND CONTROLS 106 (b) Infrastructure improvement project means any infrastructure improvement project approved in conn ection with the prior obligations and any infrastructure improvement project subsequently approved by statut e for implementation with moneys derived from the prior obligations or from new bonds issued under this Art icle.

bligations and any infrastructure improvement project subsequently approved by statut e for implementation with moneys derived from the prior obligations or from new bonds issued under this Art icle. (c) New money bond means a bond issued pursuant to this Article as part of the same issue at the refun ding bonds, but for the purpose of providing moneys for one (1) or more infrastructure improvement projects, funding any ne cessary bond reserves allocable to the new bonds or paying expenses incurred in connection with the issuance of such ne w money bonds. (d) Prior obligations means the outstanding Governm ent of Guam Limited Obligation Infrastructure Improveme nt Bonds, 1989 Series A, and the payment obligations o f the government of Guam (‘Government’) under the loan agreement, dated as of June 20, 1997 by and between the Government and Bank of Hawaii (the ‘Loan Agreement’ ). (e) Refunding bond means a bond issued pursuant to this Article for the purpose of providing moneys to rede em or otherwise retire prior obligations, funding any nec essary bond reserves allocable to the refunding bonds, or paying expenses incurred in connection with the issuance o f such refunding bonds.

em or otherwise retire prior obligations, funding any nec essary bond reserves allocable to the refunding bonds, or paying expenses incurred in connection with the issuance o f such refunding bonds. 2012 NOTE: In maintaining the general codification scheme of t he GCA the Compiler changed the hierarchy of subsections b eginning with 'Numbers' to 'Lowercase Letters' in this section. § 22951. Authorization of Issuance of Limited Oblig ation Infrastructure Improvement Bonds. The Governor of Guam is authorized to issue on beh alf of the Government an issue of bonds of the Government cons isting of refunding bonds and new money bonds, subject to the following requirements and limitations: (a) The issuance of the bonds shall not cause a vio lation of the debt limitation provision of Title 48 U.S.C. § 1423a (§ 11 of the Organic Act of Guam). COL4/6/20225 GCA GOVERNMENT OPERATIONS CH. 22 GENERAL FISCAL POLICIES AND CONTROLS 107 (b) All obligation of the Government to pay debt se rvice on the prior obligations shall be discharged concur rently with the issuance of the refunding bonds. Thereafter, an y remaining debt service on the prior obligations sha ll be payable solely from and

on the prior obligations shall be discharged concur rently with the issuance of the refunding bonds. Thereafter, an y remaining debt service on the prior obligations sha ll be payable solely from and secured solely by a refundi ng escrow established for such purpose. (c) The aggregate principal amount of refunding bon ds issued shall not exceed the amount necessary to pay the prior obligations, including by funding the refunding esc row, establish a bond reserve fund allocable to the refu nding bonds, and pay expenses incurred in connection with the issuance of the refunding bonds. (d) The aggregate principal amount of new money bonds issued shall not exceed the amount necessary to fund the projects in § 22958, establish a bond reserve f und allocable to the new money bonds and to pay expense s incurred in connection with the issuance of the new money bonds. (e) The aggregate principal amount of the bonds iss ued shall not exceed Eighty Million Dollars ($80,000,00 0). 2012 NOTE: In maintaining the general codification scheme of t he GCA the Compiler changed the hierarchy of subsections b eginning with 'Numbers' to 'Lowercase Letters' in this section. § 22952.

0). 2012 NOTE: In maintaining the general codification scheme of t he GCA the Compiler changed the hierarchy of subsections b eginning with 'Numbers' to 'Lowercase Letters' in this section. § 22952. Source of and Security for Payment of the Bonds. The bonds of the new issue shall be limited obligat ions of the Government payable from and secured by a pledge of all or any part of the hotel tax revenues. Any pledge made to secure the bonds shall be valid and binding from the time the pledge is made. The hotel tax revenues received by the Government o r any trustee, depository and custodian shall be deposited in a se parate account and shall be immediately subject to the lien of suc h pledge without physical delivery thereof or further act, and the l ien of such pledge shall be valid and binding against all parties havi ng claims of any kind in tort, contract or otherwise, against the Go vernment of such trustee, depository or custodian, irrespective of w hether the parties have notice thereof. The indenture by which such pl edge is created need not be recorded. Hotel tax revenues pledged fo r the purpose COL4/6/20225 GCA GOVERNMENT OPERATIONS CH.

f w hether the parties have notice thereof. The indenture by which such pl edge is created need not be recorded. Hotel tax revenues pledged fo r the purpose COL4/6/20225 GCA GOVERNMENT OPERATIONS CH. 22 GENERAL FISCAL POLICIES AND CONTROLS 108 of paying the bonds are hereby continuously appropr iated for such purpose and for the purposes of paying the charges of any trustee, custodian, depository, auditor or credit enhancemen t provider for the bonds and any other necessary bond expenses und er the indenture. All such revenues not needed for such pu rpose or for the purpose of paying any bonds issued pursuant to § 1515 of Title 5, Guam Code Annotated, and any expenses relating t hereto shall be transferred periodically by any trustee or other fiduciary under the indenture as provided by said § 1515. The obli gation to make such transfers shall not be a part of the contract with the bondholders, and shall be subject to the modificati on by amendment of this § 22952 by I Liheslaturan Guåhan (the Guam Legislature). SOURCE : Amended by P.L. 30-228:3 (Dec. 30, 2010). § 22953. Terms and Conditions Determined by Indentu re; Form of Bonds; Covenants; Appointment of Fiduciarie s; Other

Guåhan (the Guam Legislature). SOURCE : Amended by P.L. 30-228:3 (Dec. 30, 2010). § 22953. Terms and Conditions Determined by Indentu re; Form of Bonds; Covenants; Appointment of Fiduciarie s; Other Related Agreements. The terms and conditions of the new issue shall be as determined by the Governor by the execution of an i ndenture authorizing the issuance of the issue. The indentur e shall contain such terms and conditions as are consistent with th is Article. The technical form and language of the bonds of the new issue, including provisions for execution, exchange, trans fer, registration, paying agency, lost or mutilated bond s, negotiability, cancellation and other terms, covenants or conditio ns not inconsistent with this Article, shall be as specifi ed in the indenture executed by the Governor authorizing the issuance o f the bonds in substantially the form presented to this Legislatur e as evidenced by the attached 'Exhibit A' made part of this Act. The indenture may appoint one (1) or more trustees or other fiduc iaries authorized to receive and hold in trust the proceed s of the bonds and moneys relating thereto, to protect the rights of bondholders and to perform such

one (1) or more trustees or other fiduc iaries authorized to receive and hold in trust the proceed s of the bonds and moneys relating thereto, to protect the rights of bondholders and to perform such other duties as may be specifie d in the indenture. The Governor is also authorized to execu te, on behalf of the Government, any appropriate agreements, cert ificates or other instruments relating to the bonds and the sal e of the bonds. § 22954. Authorization for Credit Enhancement. COL4/6/20225 GCA GOVERNMENT OPERATIONS CH. 22 GENERAL FISCAL POLICIES AND CONTROLS 109 The Governor is authorized to enter into such cont racts or agreements with such banks, insurance companies or other financial institutions as he determines are necessa ry or desirable to improve the security and marketability of any bo nds authorized by this Article. Such contracts or agreements may c ontain an obligation to reimburse, with interest, any such ba nks, insurance companies or other financial institutions for advan ces used to pay principal of or interest on the issue. Any such rei mbursement obligation shall be payable solely from the same so urces as debt service on the issue is payable, and any such

or advan ces used to pay principal of or interest on the issue. Any such rei mbursement obligation shall be payable solely from the same so urces as debt service on the issue is payable, and any such advan ce, if necessary, shall be treated as creating a reimbursement obliga tion issued to refund the issue. § 22955. Valid and Binding Obligations, Collection of Revenue. The bonds of the issue authorized by this Article shall constitute the valid and binding limited obligation s of the Government. All officers charged by law with any du ty in the collection of any revenues from which debt service on the issue is payable shall do every lawful thing necessary to co llect the money necessary for such purpose. The validity of any suc h bonds shall not be affected by the validity or regularity of an y proceedings for the implementation of the infrastructure improvemen t projects funded by either the prior obligations or the new m oney bonds. § 22956. Waiver of Immunity. Notwithstanding any substantive or procedural prov ision of the Government Claims Act, Chapter 6 of Title 5 of the Guam Code Annotated, the Government waives immunity from any suit or action in contract on the bonds

any substantive or procedural prov ision of the Government Claims Act, Chapter 6 of Title 5 of the Guam Code Annotated, the Government waives immunity from any suit or action in contract on the bonds authorized by th is Article, but does not waive sovereign immunity as to the persona l liability of elected officials and employees of the Government. § 22957. No Personal Liability. No employee or elected official of the Government shall be individually or personally liable for the payment o f any amounts due on any bonds issued under this Article, or for any other liability arising in connection with the bonds; pro vided, however, that nothing in this § 22957 shall relieve any empl oyee or elected COL4/6/20225 GCA GOVERNMENT OPERATIONS CH. 22 GENERAL FISCAL POLICIES AND CONTROLS 110 official from the performance of any ministerial du ty required by law. § 22957.1. Liability of Contractors and Project Eng ineers. The General Manager of the Guam Economic Developme nt Authority in conjunction with the Director of the D epartment of Public Works and the Attorney General of Guam shall be responsible for ensuring full and faithful complian ce by private contractors and engineers with the

ion with the Director of the D epartment of Public Works and the Attorney General of Guam shall be responsible for ensuring full and faithful complian ce by private contractors and engineers with the Tumon Redevelopm ent Project specifications. Compliance shall include the time ly citation of Tumon Redevelopment Project contractors and enginee rs for any negligence and the recovery of any and all monetary damages due the government of Guam under the contracts or other wise, as well as ensuring the compliance with the standards set f orth for contractors and engineers in Chapter 70 of Title 21 of the Guam Code Annotated and Chapter 32 of Title 22 of the Gu am Code Annotated, respectively. SOURCE : Added by P.L. 26-65:10 § 22958. Infrastructure Improvement Projects. The proceeds of the new money bonds issued under t his Article are hereby appropriated for the purposes of implementing the infrastructure improvement projects contained i n the attachment marked ‘Exhibit B’ and made part of this Act. The breakdown of funding amounts for each project liste d in Exhibit B may be adjusted to meet the goals of the overall project, as long as the conditions listed in Item 16 are met.

part of this Act. The breakdown of funding amounts for each project liste d in Exhibit B may be adjusted to meet the goals of the overall project, as long as the conditions listed in Item 16 are met. SOURCE : Amended by P.L. 24-290:2. Amended by P.L. 26-065: 2. NOTE : Sections 3 through 8 amends items 1, 7, 12, 14, 1 5 and 16, respectively, of Exhibit B of P.L.26-065. Item (17 ) of Exhibit B added by P.L. 28-027. § 22959. Approval of Guam Economic Development Authority. Title 12 Guam Code Annotated § 50103(k) provides t hat agencies and instrumentalities of the Government sh all issue bonds and other obligations only by means of and th rough the agency of the Guam Economic Development Authority (‘GEDA’). No issue of bonds authorized by this Arti cle shall be COL4/6/20225 GCA GOVERNMENT OPERATIONS CH. 22 GENERAL FISCAL POLICIES AND CONTROLS 111 sold until the board of directors of GEDA has adopt ed a resolution approving the sale of such issue. § 22960. Approval of Terms and Conditions. Title 12 Guam Code Annotated § 50103(k) also provi des that GEDA shall not sell any bond without the approval o f the Guam Legislature of the terms and conditions of the issu ance of the bonds.

ions. Title 12 Guam Code Annotated § 50103(k) also provi des that GEDA shall not sell any bond without the approval o f the Guam Legislature of the terms and conditions of the issu ance of the bonds. The Guam Legislature hereby approves the iss uance, terms and conditions of the bonds authorized by this Arti cle in an aggregate principal amount not to exceed Eighty Mil lion Dollars ($80,000,000), with a final maturity not exceeding twenty (20) years and bearing interest at fixed rates not excee ding seven percent (7%) per annum. The bonds shall be issued p ursuant to an indenture in substantially the form of the indentur e presented to this Legislature as evidenced by the attached 'Exhi bit A' made part of this Act. § 22961. Permitted Investments. The proceeds of the bonds issued pursuant to this Article, and any revenues relating to such bonds, may be investe d in, but only in, the types of investments permitted by the inden ture pursuant to which such bonds are issued. § 22962. Local Sale of Bonds. The Governor of Guam shall undertake his best effo rt to cause a portion of any bonds issued pursuant to thi s Article to be offered for sale in Guam, as well as in other juris

. Local Sale of Bonds. The Governor of Guam shall undertake his best effo rt to cause a portion of any bonds issued pursuant to thi s Article to be offered for sale in Guam, as well as in other juris dictions, if and to the extent that such offer and any sales resulti ng from such offer do not increase the cost to the Government of issui ng any repaying such bonds. ----------- COL4/6/20225 GCA GOVERNMENT OPERATIONS CH. 22 GENERAL FISCAL POLICIES AND CONTROLS 112 Exhibit A COL4/6/20225 GCA GOVERNMENT OPERATIONS CH. 22 GENERAL FISCAL POLICIES AND CONTROLS 113 GOVERNMENT OF GUAM and [TRUSTEE], as Trustee Accepted by [DEPOSITARY]. As Depositary And [REGISTRAR] as Registrar ___________ INDENTURE Dated as of ____________, 1997 _____________ $___________ COL4/6/20225 GCA GOVERNMENT OPERATIONS CH. 22 GENERAL FISCAL POLICIES AND CONTROLS 114 GOVERNMENT OF GUAM LIMITED OBLIGATION INFRASTRUCTURE IMPROVEMENT BONDS including the 1997 SERIES A BONDS TABLE OF CONTENTS ARTICLE I DEFINITIONS ; CERTIFICATES § 1.01. Definitions. § 1.02. Content of Certificates and Opinions. ARTICLE II THE BONDS § 2.01. Authorization of Bonds. § 2.02. Terms of 1997 Series A Bonds. § 2.03. Form and Execution of Bonds.

ATES § 1.01. Definitions. § 1.02. Content of Certificates and Opinions. ARTICLE II THE BONDS § 2.01. Authorization of Bonds. § 2.02. Terms of 1997 Series A Bonds. § 2.03. Form and Execution of Bonds. § 2.04. Transfer of Bonds. § 2.05. Exchange of Bonds. § 2.06. Bond Register. § 2.07. Ownership of Bonds. § 2.08. Temporary Bonds. § 2.09. Bonds Mutilated, Lost, Destroyed or Stolen Book-entry System. § 2.10. Book-entry System. ARTICLE III ISSUE OF BONDS ; APPLICATION OF PROCEEDS § 3.01. Issuance, Sale and Delivery of 1997 Series A Bonds. § 3.02. Application of Proceeds of 1997 Series A Bo nds and Other Amounts. § 3.03. Establishment and Application of Constructi on Fund. § 3.04. Issuance of Additional Series of Bonds. § 3.05. Proceedings for Issuance of Additional Seri es of Bonds. COL4/6/20225 GCA GOVERNMENT OPERATIONS CH. 22 GENERAL FISCAL POLICIES AND CONTROLS 115 § 3.06. Validity of Bonds. ARTICLE IV REDEMPTION OF BONDS § 4.01. Terms of Redemption. § 4.02. Selection of Bonds for Redemption. § 4.03. Notice of Redemption. § 4.04. Partial Redemption. § 4.05. Effect of Redemption. ARTICLE V REVENUES § 5.01. Pledge and Assignment; Revenue Fund. § 5.02. Allocation of Revenues. § 5.03.

mption. § 4.03. Notice of Redemption. § 4.04. Partial Redemption. § 4.05. Effect of Redemption. ARTICLE V REVENUES § 5.01. Pledge and Assignment; Revenue Fund. § 5.02. Allocation of Revenues. § 5.03. Application of Bond Fund. § 5.04. Application of Bond Reserve Fund. § 5.05. Application of Bond Expense Fund. § 5.06. Deficiencies in Bond Fund. § 5.07. Investment of Moneys in Funds. § 5.08. Rebate Fund. § 5.09. Credit Facility. ARTICLE VI PARTICULAR COVENANTS § 6.01. Punctual Payment. § 6.02. Extension of Payment of Principal and Inter est on the Bonds. § 6.03. Limitation on Encumbrances. § 6.04. Power to Issue Bonds and Make Pledge. § 6.05. Payment of Taxes and Claims. § 6.06. Accounting Records and Financial Statements . § 6.07. Maintenance of Powers. § 6.08. Continuing Disclosure. § 6.09. Tax Covenants. § 6.10. Compliance with Indenture, Contracts, Laws and Regulations. § 6.11. Collection of Hotel Room Taxes. COL4/6/20225 GCA GOVERNMENT OPERATIONS CH. 22 GENERAL FISCAL POLICIES AND CONTROLS 116 § 6.12. Annual Budgets. § 6.13. [Reserved.] § 6.14. Waiver of Laws. § 6.15. Further Assurances. ARTICLE VII EVENTS OF DEFAULT AND REMEDIES OF BONDHOLDERS § 7.01. Events of Default § 7.02.

ONTROLS 116 § 6.12. Annual Budgets. § 6.13. [Reserved.] § 6.14. Waiver of Laws. § 6.15. Further Assurances. ARTICLE VII EVENTS OF DEFAULT AND REMEDIES OF BONDHOLDERS § 7.01. Events of Default § 7.02. Acceleration of Maturities. § 7.03. Application of Revenues and Other Funds Aft er Default. § 7.04. Trustee to Represent Bondholders. § 7.05. Bondholders Direction of Proceedings. § 7.06. Limitation on Bondholders§ Right to Sue. § 7.07. Absolute Obligation of Government. § 7.08. Termination of Proceedings. § 7.09 Remedies Not Exclusive. § 7.10. No Waiver of Default. ARTICLE VIII THE FIDUCIARIES § 8.01. Duties, Immunities and Liabilities of Trust ee, Depositary and Registrar. § 8.02. Compensation. § 8.03. Liability of Trustee, Depositary and Regist rar. § 8.04. Right of Fiduciaries to Rely on Documents. § 8.05. Preservation and inspection of Documents. § 8.06. Paying Agents. § 8.07. Notices to Rating Agencies. ARTICLE IX MODIFICATION OR AMENDMENT OF THE INDENTURE § 9.01. Amendments Permitted. § 9.02. Effect of Supplemental Indenture. § 9.03. Endorsement of Bonds; Preparation of New Bo nds. § 9.04. Amendment of Particular Bonds. § 9.05. Credit Provider Consent.

9.01. Amendments Permitted. § 9.02. Effect of Supplemental Indenture. § 9.03. Endorsement of Bonds; Preparation of New Bo nds. § 9.04. Amendment of Particular Bonds. § 9.05. Credit Provider Consent. COL4/6/20225 GCA GOVERNMENT OPERATIONS CH. 22 GENERAL FISCAL POLICIES AND CONTROLS 117 ARTICLE X DEFEASANCE § 10.01. Discharge of Indenture. § 10.02. Discharge of Liability on Bonds. § 10.03. Deposit of Money or Securities with Truste e. § 10.04. Payment of Bonds after Discharge of Indent ure. ARTICLE XI MISCELLANEOUS § 11.01. Liability of Government Limited to Revenue s. § 11.02. Successor Is Deemed Included in References to Predecessor. § 11.03. Limitation of Rights to Parties and Bondho lders. § 11.04. Waiver of Notice. § 11.05. Destruction of Bonds. § 11.06. Severability of Invalid Provisions. § 11.07. Notices § 11.08. Evidence of Rights of Provisions. § 11.09. Disqualified Bonds. § 11.10. Money Held for Particular Bonds. § 11.11. Funds and Accounts. § 11.12. Article and Section Headings and Reference s. § 11.13. Waiver of Personal Liability. § 11.14. Saturdays, Sundays and Legal Holidays. § 11.15. Execution in Several Counterparts. § 11.16. Governing Law.

rticle and Section Headings and Reference s. § 11.13. Waiver of Personal Liability. § 11.14. Saturdays, Sundays and Legal Holidays. § 11.15. Execution in Several Counterparts. § 11.16. Governing Law. THIS INDENTURE, made and entered into as of, ____________, 1997, by and among the GOVERNMENT OF GUAM, duly organized and existing under and by virt ue of the laws of the United States of America (the Governmen t), and [TRUSTEE], a [_______] banking [corporation] duly o rganized and existing under and by virtue of the laws of the ______________ having a corporate trust office in _ ________, _________, and being qualified to accept and admini ster the trusts hereby created and to do business within Guam (the ‘Trustee’), and accepted by [DEPOSITARY), a [________] banking [corporation] organized under the laws of the _____ __________, COL4/6/20225 GCA GOVERNMENT OPERATIONS CH. 22 GENERAL FISCAL POLICIES AND CONTROLS 118 and authorized to do business within Guam (the ‘Dep ositary’ ), and [REGISTRAR], a [national] banking [association] organized under the laws of the [United States of America] (t he ‘Registrar’), WITNESSETH: WHEREAS, pursuant to Section_____ of Title 5, Guam Code Annotated,

TRAR], a [national] banking [association] organized under the laws of the [United States of America] (t he ‘Registrar’), WITNESSETH: WHEREAS, pursuant to Section_____ of Title 5, Guam Code Annotated, as amended (the ‘Act’ ), the Legisl ature of Guam has authorized the Governor of Guam to borrow money in an amount not to exceed $ _____ for the purpose of imp lementing certain infrastructure improvement projects and for the purpose of refunding and repaying certain prior obligations of the Government incurred to finance infrastructure impro vement projects; WHEREAS, the Guam Economic Development Authority has approved the issuance and sale of said bonds as provided by 12 Guam Code Annotated § 2103(k); WHEREAS, all acts, conditions and things required by the laws of the United States of America and the govern ment of Guam to exist, to have happened and to have been perform ed precedent to and in connection with the issuance of said bond s exist, have happened, and have been performed in regular and du e time, form and manner as required by law, and the Government i s now duly authorized and empowered, pursuant to each and ever y requirement of law, to issue said bonds for the pur

in regular and du e time, form and manner as required by law, and the Government i s now duly authorized and empowered, pursuant to each and ever y requirement of law, to issue said bonds for the pur pose, in the manner and upon the terms herein provided; and WHEREAS, said bonds are to be issued hereunder in the aggregate principal amount of ________________________________ Dollars ($______) for such purpose and are to be designated as the ‘Gover nment of Guam Limited Obligation Infrastructure Improvement Bonds, 1997 Series A’; NOW, THEREFORE, THIS INDENTURE WITNESSETH, that in order to secure the payment of the principa l of, and the premium, if any, and interest on, all Bonds at any time issued and outstanding under THIS Indenture, according to thei r tenor, and to secure the performance and observance of all the covenants and conditions therein and herein set forth, and to dec lare the terms and conditions upon and subject to which the Bonds are to be COL4/6/20225 GCA GOVERNMENT OPERATIONS CH. 22 GENERAL FISCAL POLICIES AND CONTROLS 119 issued and received, and in consideration of the pr emises and of the mutual covenants herein contained and of the pu rchase and acceptance of

ERATIONS CH. 22 GENERAL FISCAL POLICIES AND CONTROLS 119 issued and received, and in consideration of the pr emises and of the mutual covenants herein contained and of the pu rchase and acceptance of the Bonds by the holders thereof, and for other valuable considerations, the receipt whereof is her eby acknowledged, the Government does hereby covenant a nd agree with the Trustee for the benefit of the respective holders from time to time of the Bonds, as follows: ARTICLE I DEFINITIONS ; CERTIFICATES § 1.01. Definitions. Unless the context otherwise requires, the terms d efined in THIS Section shall for all purposes of THIS Indentu re, and of any indenture supplemental hereto and of any certificat e, opinion or other document herein mentioned, have the meanings herein specified, to be equally applicable to both the sin gular and plural forms of any of the terms herein defined. Act Act means Section____ of Title 5, Guam Code Annotat ed, as amended, and as it may from time to time hereafter be amended or supplemented with respect to the Bonds. Annual Debt Service Annual Debt Service means, as of any date of calcul ation, the sum of (1) the interest falling due on then Outstan ding

after be amended or supplemented with respect to the Bonds. Annual Debt Service Annual Debt Service means, as of any date of calcul ation, the sum of (1) the interest falling due on then Outstan ding Bonds (assuming that all then Outstanding Serial Bonds ar e retired on their respective maturity dates and that all then O utstanding Term Bonds are retired at the times of and in amounts pr ovided for by the Mandatory Sinking Account Payments applicable t o such Term Bonds), (2) the principal amount of then Outst anding Serial Bonds falling due by their terms, and (3) the aggre gate amount of all Mandatory Sinking Account Payments required; al l as computed for any Bond Year. Bond Expense Fund Bond Expense Fund means the fund by that name estab lished pursuant to § 5.01. COL4/6/20225 GCA GOVERNMENT OPERATIONS CH. 22 GENERAL FISCAL POLICIES AND CONTROLS 120 Bond Expenses Bond Expenses means the fees and expenses of the Fiduciaries, fees for any Credit Facility, includin g any instrument designated by a Supplemental Indenture as providing supplemental credit support for a Series of Bonds, Costs of Issuance not paid from the proceeds of Bonds, expen ses of any audit report provided

nt designated by a Supplemental Indenture as providing supplemental credit support for a Series of Bonds, Costs of Issuance not paid from the proceeds of Bonds, expen ses of any audit report provided pursuant to § 6.06 hereof, fe es for any Opinion of Counsel, and any other casts or expenses designated as Bond Expenses by a Supplemental indenture. Bond Fund Bond Fund means the fund by that§ name established pursuant to § 5.01. Bond Reserve Fund Bond Reserve Fund means the fund by that name estab lished pursuant to § 5.01. Bond Reserve Fund Requirement Bond Reserve Fund Requirement means (a) for any dat e of calculation, an amount equal to the least of (i) Ma ximum Annual Debt Service, (ii) ten percent (10%) of the proceed s received from the sale of the Series then having Bonds Outstandin g, or (iii) one hundred twenty-five percent (125%) of average Annua l Debt Service on the Series then having Bonds Outstanding ; or (b) such greater amount as may be specified by Supplemental Indenture providing for the issuance of a Series of Bonds; wh ich in each case may be satisfied in whole or in part by a Credit Fa cility as provided in § 5.04.

nt as may be specified by Supplemental Indenture providing for the issuance of a Series of Bonds; wh ich in each case may be satisfied in whole or in part by a Credit Fa cility as provided in § 5.04. Bond Year Bond Year means the period of twelve consecutive mo nths ending on __________ in any year in which Bonds are or will be Outstanding. Bonds, Serial Bonds, Term Bonds, 1997 Series A Bon ds Bonds means the Government of Guam Limited Obligati on Infrastructure Improvement Bonds, authorized by, an d at any time Outstanding pursuant to, THIS Indenture. COL4/6/20225 GCA GOVERNMENT OPERATIONS CH. 22 GENERAL FISCAL POLICIES AND CONTROLS 121 Serial Bonds means the Bonds, falling due by their terms on specified dates, for which no Mandatory Sinking Acc ount Payments are provided. Term Bonds means the Bonds payable at or before the ir specified maturity date or dates from Mandatory Sin king Account Payments established for that purpose and calculate d to retire such Bonds on or before their specified maturity date or dates. 1997 Series A Bonds means the Government of Guam Limited Obligation Infrastructure Improvement Bonds , 1997 Series A, issued hereunder.

such Bonds on or before their specified maturity date or dates. 1997 Series A Bonds means the Government of Guam Limited Obligation Infrastructure Improvement Bonds , 1997 Series A, issued hereunder. Business Day Business Day means any day on which banks in the ci ties in which the Principal Offices of the Trustee and each Credit Provider are located are not required or authorized to close and on which the New York Stock Exchange is not closed. Certificate. Order Request, Requisition, or Stateme nt of the Government Certificate, Order, Request, Requisition and Statem ent mean, respectively, a written certificate, order, request , requisition or statement executed by the Governor, the Director of Administration or such other person as may be desig nated and authorized by the Governor to sign for the Governme nt. Any such instrument and supporting opinions or representatio ns, if any, may, but need not, be combined in a single instrume nt with any other instrument, opinion or representation, and th e two or more so combined shall be read and construed as a single instrument. If and to the extent required by § 1.02, each such ins trument shall include the statements provided for in §

ion, and th e two or more so combined shall be read and construed as a single instrument. If and to the extent required by § 1.02, each such ins trument shall include the statements provided for in § 1.02. Code Code means the Internal Revenue Code of 1986, and reference to any section or other provision thereof shall include any successor provision and any regulations thereun der. Construction Fund Construction Fund means the fund by that name creat ed pursuant to § 3.03. COL4/6/20225 GCA GOVERNMENT OPERATIONS CH. 22 GENERAL FISCAL POLICIES AND CONTROLS 122 Costs of Issuance Costs of Issuance means all items of expense direct ly or indirectly payable by or reimbursable to the Govern ment and related to the authorization, issuance, sale and de livery of the Bonds, including but not limited to advertising cos ts, Bond and official statement printing costs, costs of prepara tion and reproduction of documents, filing and recording fee s, initial fees and charges of the Trustee, the Depositary and the Registrar, legal fees and charges, fees and disbursements of consult ants and professionals, Rating Agency fees, fees and charges for preparation,, execution, transportation and safekee

itary and the Registrar, legal fees and charges, fees and disbursements of consult ants and professionals, Rating Agency fees, fees and charges for preparation,, execution, transportation and safekee ping of Bonds and any other cost, charge or fee in connection wit h the original issuance of Bonds. Credit Agreement Credit Agreement means any agreement between the Government and a Credit Provider pursuant to which such Credit Provider agrees to provide a Credit Facility. Credit Facility Credit Facility means the [Municipal Bond Insurance Policy], dated not later than the date of initial i ssuance and delivery of the 1997 Series A Bonds, issued by the Credit Provider for the 1997 Series A Bonds, or any substitute ther efor permitted hereby, and any other insurance policy, surety bond , letter of credit or other instrument designated by a Suppleme ntal Indenture as providing supplemental credit support for a Seri es of Bonds. Any Credit Facility delivered with respect to a Ser ies of Bonds in substitution for the Credit Facility theretofore in effect with respect to such Series must (i) be delivered to the Trustee before the stated expiration date of the Credit Facility t heretofore

ds in substitution for the Credit Facility theretofore in effect with respect to such Series must (i) be delivered to the Trustee before the stated expiration date of the Credit Facility t heretofore in effect; and (ii) be accompanied, upon such delivery to the Trustee, by a written statement of each Rating Agency to the effect that the rating then assigned by such Rating Agency to such Series will not be reduced or withdrawn as a result of such sub stitution. Credit Provider Credit Provider means [AMBAC Indemnity Corporation] or the issuer of any substitute Credit Facility, and a ny other person, COL4/6/20225 GCA GOVERNMENT OPERATIONS CH. 22 GENERAL FISCAL POLICIES AND CONTROLS 123 firm or entity designated in a Supplemental Indentu re as providing supplemental credit support for a Series of Bonds. Depositary Depositary means [Depositary], a [_______] banking [corporation] organized under the laws of the _____ __________, or its successor, as Depositary hereunder as provid ed in § 8.01. Director of Administration Director of Administration means the Director of Administration of the Government of Guam or any suc cessor to the rights, powers and obligations thereof under th e Act

01. Director of Administration Director of Administration means the Director of Administration of the Government of Guam or any suc cessor to the rights, powers and obligations thereof under th e Act with respect to the Bonds. Event of Default Event of Default means any of the events specified in § 7.01. Fiduciaries Fiduciaries means the Trustee, the Depositary, the Registrar and any Paying Agents. Fiscal Year Fiscal Year means the period beginning on October 1 of each year and ending on the next succeeding September 30 , or any other twelve-month period hereafter selected and de signated as the official fiscal year period of the Government. Government Government means the Government of Guam or any successor to the rights, powers and obligations the reof under the Act with respect to the Bonds. Governor Governor means the Governor of Guam or any successo r to the rights, powers and obligations thereof under th e Act with respect to the Bonds. Holder or Bondholder Holder or Bondholder means the person in whose name a Bond is registered. COL4/6/20225 GCA GOVERNMENT OPERATIONS CH. 22 GENERAL FISCAL POLICIES AND CONTROLS 124 Hotel Room Taxes Hotel Room Taxes means the taxes now

older means the person in whose name a Bond is registered. COL4/6/20225 GCA GOVERNMENT OPERATIONS CH. 22 GENERAL FISCAL POLICIES AND CONTROLS 124 Hotel Room Taxes Hotel Room Taxes means the taxes now imposed by Sec tion _____ of Title _____, Guam Code Annotated, as amend ed, together with all other hotel room taxes hereafter required to be levied under the Act and THIS Indenture for the pay ment of the Bonds, the interest thereon, Bond Expenses and for the maintenance of the Bond Reserve Fund. Indenture Indenture means THIS Indenture, as originally execu ted or as it may from time to time be supplemented, modifi ed or amended by any Supplemental Indenture. Independent Independent means, when used with respect to any gi ven person, that such person (who may be selected and p aid by the Government) is acceptable to the Trustee and (1) is in fact independent and not under domination of the Governm ent; (2) does not have any substantial interest, direct or i ndirect, with the Government; and (3) is not connected with the Gover nment as an officer or employee of the Government, but who may be regularly retained to provide services to the Government.

or i ndirect, with the Government; and (3) is not connected with the Gover nment as an officer or employee of the Government, but who may be regularly retained to provide services to the Government. Independent Consultant Independent Consultant means any Independent certif ied public accountant, Independent engineer or other In dependent consultant, who is in any case experienced in the p reparation of feasibility studies for use in connection with the financing of infrastructure improvements. Infrastructure Improvement Projects Infrastructure Improvement Projects means any proje ct described in Section ________(a)(3) of the Act. Interest Payment Date Interest Payment Date means May 15 and November 15 of each year, commencing _________. Investment Securities COL4/6/20225 GCA GOVERNMENT OPERATIONS CH. 22 GENERAL FISCAL POLICIES AND CONTROLS 125 Investment Securities means any investment securiti es which at the time are legal investments under the laws of the Government of Guam for moneys held hereunder and then proposed to be invested therein. Legislature Legislature means the Legislature of Guam or any su ccessor to the rights, powers and obligations thereof under the Act with

oneys held hereunder and then proposed to be invested therein. Legislature Legislature means the Legislature of Guam or any su ccessor to the rights, powers and obligations thereof under the Act with respect to the Bonds. Mandatory Sinking Account Payment Mandatory Sinking Account Payment means, as of any date of calculation with respect to any Series of Bonds, the amount required by THIS Indenture or any Supplemental Inde nture to be paid by the Government on a given date for the reti rement of Term Bonds of such Series. Maximum Annual Debt Service Maximum Annual Debt Service means, for any date of calculation, Annual Debt Service computed for the B ond Year thereafter in which such amount shall be largest. Opinion of Counsel Opinion of Counsel means a written opinion addresse d to the Government of nationally recognized bond counsel (w ho may be counsel for the Government) selected by the Governm ent. If and to the extent required by the provisions of § 1.02, each Opinion of Counsel shall include the statements provided for i n § 1.02. Outstanding Outstanding, when used as of any particular time wi th reference to Bonds, means (subject to the provision s of § 11.09) all Bonds

el shall include the statements provided for i n § 1.02. Outstanding Outstanding, when used as of any particular time wi th reference to Bonds, means (subject to the provision s of § 11.09) all Bonds theretofore, or thereupon being, authenti cated and delivered by the Trustee under THIS Indenture excep t (1) Bonds theretofore canceled by the Trustee or surrendered to the Trustee for cancellation; (2) Bonds with respect to which a ll liability of the Government shall have been discharged in accord ance with § 10.02, including Bonds (or portions of Bonds) ref erred to in § 11.10; and (3) Bonds for the transfer or exchange of or in lieu of or in substitution for which other Bonds shall have been COL4/6/20225 GCA GOVERNMENT OPERATIONS CH. 22 GENERAL FISCAL POLICIES AND CONTROLS 126 authenticated and delivered by the Trustee pursuant to THIS Indenture. Paving Agent Paying Agent means any paying agent appointed by or pursuant to § 8.06. Person Person or person means an individual, corporation, firm, association, partnership, trust, or other legal ent ity or group of entities, including a governmental entity or any ag ency or political subdivision thereof.

means an individual, corporation, firm, association, partnership, trust, or other legal ent ity or group of entities, including a governmental entity or any ag ency or political subdivision thereof. Principal Office Principal Office means, with respect to the Trustee , the Depositary and the Registrar, the office at the res pective address set forth in § 11.07 hereof or at such other addres s as the respective party may have designated for such purpo se. The Principal Office of any Credit Provider shall be as specified by such Credit Provider pursuant to its Credit Facilit y or Credit Agreement. Principal Payment Date Principal Payment Date means November 15 of any yea r. Rating Agency Rating Agency means, with respect to any Series of Bonds, each rating agency then rating such Bonds at the re quest of the Government or the applicable Credit Provider. Rebate Fund Rebate Fund means the fund by that name established pursuant to § 5.08. Redemption Price Redemption Price means, with respect to any Bond (o r portion thereof if less than all of a Bond is to be redeemed) the principal amount of such Bond (or portion) plus the applicable premium, if any, payable upon redemption thereof

pect to any Bond (o r portion thereof if less than all of a Bond is to be redeemed) the principal amount of such Bond (or portion) plus the applicable premium, if any, payable upon redemption thereof pu rsuant to the provisions of such Bond and THIS Indenture. COL4/6/20225 GCA GOVERNMENT OPERATIONS CH. 22 GENERAL FISCAL POLICIES AND CONTROLS 127 Registrar Registrar means [Registrar], a [national] banking [association] organized under the laws of the [Unit ed States of America], or its successor, as Registrar hereunder as provided in § 8.01. Revenues Revenues means all amounts received by the Governme nt, the Trustee or the Depositary as proceeds of Hotel Room Taxes and deposited in the Revenue Fund, all interest, pr ofits or other income derived from the investment of amounts in an y fund or account established pursuant to THIS Indenture, and any other amounts received by the Government, the Trustee or the Depositary and pledged by any Supplemental Indentur e in accordance with § 3.04(B). Revenue Fund Revenue Fund means the fund by that name establishe d pursuant to § 5.01. Series Series or Series of Bonds means and refers to all B onds of like designation authenticated and

§ 3.04(B). Revenue Fund Revenue Fund means the fund by that name establishe d pursuant to § 5.01. Series Series or Series of Bonds means and refers to all B onds of like designation authenticated and delivered on ori ginal issuance at the same time pursuant to THIS Indenture or any Supplemental Indenture and any Bonds thereafter delivered in lie u of or substitution for any of such Bonds pursuant to THIS Indenture. Supplemental Indenture Supplemental Indenture means any indenture hereafte r duly authorized under and in compliance with the Act, an d entered into by and among the Government and the Trustee and acc epted by the Depositary and the Registrar supplementing, mod ifying or amending THIS Indenture; but only if and to the ext ent that such Supplemental Indenture is specifically authorized h ereunder. Tax Certificate Tax Certificate means a Certificate of the Governme nt concerning the calculation of the amount to be paid to the United COL4/6/20225 GCA GOVERNMENT OPERATIONS CH. 22 GENERAL FISCAL POLICIES AND CONTROLS 128 States of America pursuant to § 1480) of the Code a nd concerning certain other tax matters relating to the Bonds.

L4/6/20225 GCA GOVERNMENT OPERATIONS CH. 22 GENERAL FISCAL POLICIES AND CONTROLS 128 States of America pursuant to § 1480) of the Code a nd concerning certain other tax matters relating to the Bonds. Tourist Attraction Fund Tourist Attraction Fund means the fund of the Gover nment so designated and created pursuant to Section _____ _ of Title _____, Guam Code Annotated. Trustee Trustee means [Trustee], a [______] banking [corpor ation] duly organized and existing under the laws of the _ ___________, or its successor, as Trustee hereunder as provided in § 8.01. § 1.02. Content of Certificates and Opinions. Every certificate or opinion provided for in THIS Indenture with respect to compliance with any provision hereo f shall include (1) a statement that the person making or giving su ch certificate or opinion has read such provision and the definiti ons herein relating thereto; (2) a brief statement as to the n ature and scope of the examination or investigation upon which the cer tificate or opinion is based; (3) a statement that, in the opin ion of such person, he has made or caused to be made such .exam ination or investigation as is necessary to enable him to expr ess an

r tificate or opinion is based; (3) a statement that, in the opin ion of such person, he has made or caused to be made such .exam ination or investigation as is necessary to enable him to expr ess an informed opinion with respect to the subject matter referred to in the instrument to which his signature is affixed; and ( 4) a statement as to whether, in the opinion of such person, such provision has been complied with. Any such certificate or opinion made or given by an officer of the Government may be based, insofar as it relat es to legal or accounting matters, upon a certificate or opinion o f or representation by counsel or an accountant, unless such officer knows, or in the exercise of reasonable care should know, that the certificate, opinion or representation with respect to the matters upon which such certificate or statement may be’ ba sed, -as aforesaid, is erroneous. Any such certificate or op inion made or given by counsel or an accountant may be based, ins ofar as it relaxes to factual matters (with respect to which i nformation is in the possession of the Government) upon a certificat e or opinion of or representation by an officer of the Government, unless such

relaxes to factual matters (with respect to which i nformation is in the possession of the Government) upon a certificat e or opinion of or representation by an officer of the Government, unless such COL4/6/20225 GCA GOVERNMENT OPERATIONS CH. 22 GENERAL FISCAL POLICIES AND CONTROLS 129 counsel or accountant knows, or in the exercise of reasonable care should know, that the certificate or opinion or rep resentation with respect to the matters upon which such officer’s ce rtificate or opinion or representation may be based, as aforesai d, is erroneous. The same officer of the Government or the same coun sel or accountant, as the case may be, need not certify to all of the matters required to be certified under any provisio n of THIS Indenture, but different officers, counsel or accou ntants may certify to different matters. respectively. ---------- ARTICLE II THE BONDS § 2.01. Authorization of Bonds. Bonds may be issued hereunder from time to time in order to carry out the purposes of the Act as in this Indent ure provided. The maximum principal amount of Bonds which may be issued hereunder is not limited; subject, however, to the right of the Government, which is hereby reserved,

the Act as in this Indent ure provided. The maximum principal amount of Bonds which may be issued hereunder is not limited; subject, however, to the right of the Government, which is hereby reserved, to limit or r estrict, by Supplemental Indenture, the aggregate principal amo unt of Bonds which may at any time be issued and Outstanding her eunder, and to such limits as may otherwise be imposed by law. The Bonds are designated generally as the ‘Government of Guam Lim ited Obligation Infrastructure Improvement Bonds’; each Series thereof to bear such additional designation as may be necessary or appropriate to distinguish such Series from every o ther Series of Bonds. The Bonds may be issued in such Series as fr om time to time shall be established and authorized by the Gov ernment, subject to the covenants, provisions and conditions herein contained. § 2.02. Terms of 1997 Series A Bonds. (A) An initial Series of Bonds to be issued under this Indenture is hereby created, and such Bonds are des ignated as the 'Government of Guam Limited Obligation Infrastructu re Improvement Bonds, 1997 Series A.' The aggregate pr incipal amount of 1997 Series A Bonds which may be issued a nd

Bonds are des ignated as the 'Government of Guam Limited Obligation Infrastructu re Improvement Bonds, 1997 Series A.' The aggregate pr incipal amount of 1997 Series A Bonds which may be issued a nd COL4/6/20225 GCA GOVERNMENT OPERATIONS CH. 22 GENERAL FISCAL POLICIES AND CONTROLS 130 Outstanding under this Indenture shall not exceed ________________________________Dollars ($_________ __). (B) The 1997 Series A Bonds shall be dated as of___ ____, 1997, and interest thereon shall be payable on each Interest Payment Date. The 1997 Series A Bonds shall be issu ed only in fully registered form in denominations of 15,000 or any integral multiple thereof, shall mature on the Principal Pay ment Date in each of the following years in the following amount s and shall bear interest at the following rates per annum: Year Principal Amount Rate Interest The principal or Redemption Price of the 1997 Serie s A Bonds shall be payable in lawful money of the Unite d States of America upon surrender thereof at the Principal Off ice of the Trustee. The 1997 Series A Bonds of each maturity shall be designated numerically or alphabetically by the dir ection of the Trustee.

of America upon surrender thereof at the Principal Off ice of the Trustee. The 1997 Series A Bonds of each maturity shall be designated numerically or alphabetically by the dir ection of the Trustee. Each 1997 Series A Bond shall bear interes t, computed on the basis of a 360-day year of twelve 30-day mon ths, from the interest payment date next preceding the date of re gistration thereof unless it is registered as of a day during the period from the fourteenth day next preceding any interest paym ent date to such interest payment date, inclusive, in which eve nt it shall bear interest from such interest payment date, or unless it is registered on or prior to ________, in which event it shall be ar interest from its date; provided, however, that if, at the time o f registration of any 1997 Series A Bond, interest is in default on O utstanding Bonds, such Bond shall bear interest from the date to which interest has previously been paid or made available for payment on the Outstanding Bonds. Payment of the interest o n any Bond shall be made to the person whose name appears on t he bond registration books of the Registrar as the register ed owner thereof as of the close of business

onds. Payment of the interest o n any Bond shall be made to the person whose name appears on t he bond registration books of the Registrar as the register ed owner thereof as of the close of business on the fifteenth day im mediately preceding an interest payment date, whether or not such day is a Business Day, such interest to be paid by check or draft mailed to such registered owner at such registered owner’s ad dress as it appears on such registration books. COL4/6/20225 GCA GOVERNMENT OPERATIONS CH. 22 GENERAL FISCAL POLICIES AND CONTROLS 131 The Bonds shall be subject to redemption as provide d in Article IV. § 2.03. Form and Execution of Bonds. The Bonds and the form of Registrar’s certificate of authentication and registration to appear thereon s hall be in substantially the forms set forth in Exhibit A here to, respectively. with necessary or appropriate variations, omissions and insertions, as permitted or required by this Indenture. Any por tion of the text of any Bond may be set forth on the reverse thereof , with an appropriate reference thereto on the face of such B ond. Bonds may be typewritten, printed, engraved, lithographed or otherwise produced.

of any Bond may be set forth on the reverse thereof , with an appropriate reference thereto on the face of such B ond. Bonds may be typewritten, printed, engraved, lithographed or otherwise produced. The Bonds shall be executed in the name and on beha lf of the Government with the manual or facsimile signatures of the Governor of Guam and the Director of Administration under its seal. Such seal may be in the form of a facsimile o f the Government’s seal and may be reproduced, imprinted or impressed on the Bonds. The Bonds shall then be del ivered to the Registrar for authentication by it. In case any of the officers who shall have signed any of the Bonds shall cease to b e such officer or officers of the Government before the Bonds so s igned shall have been authenticated or delivered by the Registr ar or issued by the Government, such Bonds may nevertheless be auth enticated, delivered and issued and, upon such authentication, delivery and issue, shall be as binding upon the Government as t hough those who signed the same had continued to be such office rs of the Government, and also any Bond may be signed on beha lf of the Government by such persons as at the actual date of

rnment as t hough those who signed the same had continued to be such office rs of the Government, and also any Bond may be signed on beha lf of the Government by such persons as at the actual date of execution of such Bond shall be the proper officers of the Gover nment although at the nominal date of such Bond any such person sh all not have been such officer of the Government. Only such of the Bonds as shall bear thereon a cert ificate of authentication and registration in the form set for th in Exhibit A hereto, manually executed by the Registrar, shall b e valid or obligatory for any purpose or entitled to the benef its of this Indenture, and such certificate of the Registrar sh all be conclusive evidence that the Bonds so authenticated have been duly executed, COL4/6/20225 GCA GOVERNMENT OPERATIONS CH. 22 GENERAL FISCAL POLICIES AND CONTROLS 132 authenticated and delivered hereunder and are entit led to the benefits of this Indenture. § 2.04. Transfer of Bonds. Any Bond may, in accordance with its terms, be tra nsferred, upon the books required to be kept pursuant to the provisions of § 2.06, by the person in whose name it is registered, in person or by such registered

, in accordance with its terms, be tra nsferred, upon the books required to be kept pursuant to the provisions of § 2.06, by the person in whose name it is registered, in person or by such registered owner’s duly authorized attorney, u pon surrender of such Bond for cancellation at the Principal Offi ce of the Registrar accompanied by delivery of a written inst rument of transfer, duly executed in a form approved by the R egistrar. Whenever any Bond or Bonds shall be surrendered fo r transfer, the Government shall execute and the Regi strar shall authenticate and deliver a new fully registered Bon d or Bonds of the same Series, maturity and tenor, of any authori zed denomination or denominations and for the aggregate principal amount of such Bond or Bonds then remaining Outstan ding, to the transferee in exchange therefor. The Registrar shal l require the payment by the Bondholder requesting such transfer of any tax or other governmental charge required to be paid with respect to such transfer, and may collect from the Government a cha rge equal to the customary fee charged by the Registrar for such transfers.

x or other governmental charge required to be paid with respect to such transfer, and may collect from the Government a cha rge equal to the customary fee charged by the Registrar for such transfers. No transfer of any Bond shall be required during t he five days next preceding any date established by the Trustee for the selection of Bonds for redemption or a any time aft er selection of such Bond for redemption. § 2.05. Exchange of Bonds. Any Bond may, in accordance with its terms, be exc hanged at the Principal Office of the Registrar for a new fully registered Bond or Bonds of the same Series, maturity and teno r, of any authorized denomination or denominations and for th e aggregate principal amount of such Bond then remaining Outsta nding. The Registrar shall require the payment by the Bondhold er requesting such exchange of any tax or other governmental char ge required to be paid with respect to such exchange, and may c ollect from the Government a charge equal to the customary fee char ged by the Registrar for such exchanges. COL4/6/20225 GCA GOVERNMENT OPERATIONS CH. 22 GENERAL FISCAL POLICIES AND CONTROLS 133 § 2.06. Bond Register.

ernment a charge equal to the customary fee char ged by the Registrar for such exchanges. COL4/6/20225 GCA GOVERNMENT OPERATIONS CH. 22 GENERAL FISCAL POLICIES AND CONTROLS 133 § 2.06. Bond Register. The Registrar will keep or cause to be kept, at it s Principal Office, sufficient books for the registration and t ransfer of the Bonds, which shall at all times be open to inspecti on by the Government; and the Registrar shall provide to the Trustee a copy of such books with respect to the registration of t he Bonds, (i) not later than ten days before each date on which princ ipal or interest is payable with respect to any of the Bonds, (ii) n ot later than the date on which Bonds are to be selected for redempti on and (iii) promptly upon request of the Trustee at any other t ime. Upon presentation for such purpose, the Registrar shall, under such reasonable regulations as it may prescribe, registe r or transfer or cause to be registered or transferred, on such book s, Bonds as hereinbefore provided. § 2.07. Ownership of Bond. The person in whose name any Bond shall be registe red shall be deemed and regarded as the absolute owner thereo f for all purposes, and payment of or on

inbefore provided. § 2.07. Ownership of Bond. The person in whose name any Bond shall be registe red shall be deemed and regarded as the absolute owner thereo f for all purposes, and payment of or on account of the princ ipal and Redemption Price of, and the interest on, any such Bond, shall be made only to or upon the order of the registered ow ner thereof or such registered owner’s legal representative. All s uch payments shall be valid and effectual to satisfy and dischar ge the liability upon such Bond including the interest thereon to th e extent of the sum or sums so paid. § 2.08. Temporary Bonds. The Bonds may be initially issued in temporary for m exchangeable for definitive Bonds when ready for de livery. Any temporary Bend may be printed, lithographed or type written, shall be of such denomination as may be determined by the Government, shall be in registered form without cou pons and may contain such reference to any of the provisions of this Indenture as may be appropriate. Every temporary Bond shall b e executed by the Government and be authenticated by the Regis trar upon the same conditions and in substantially the same manne r as the definitive Bonds.

e appropriate. Every temporary Bond shall b e executed by the Government and be authenticated by the Regis trar upon the same conditions and in substantially the same manne r as the definitive Bonds. If the Government issues temporar y Bonds it will execute and furnish definitive Bonds without d elay, and thereupon the temporary Bonds may be surrendered, f or COL4/6/20225 GCA GOVERNMENT OPERATIONS CH. 22 GENERAL FISCAL POLICIES AND CONTROLS 134 cancellation, in exchange therefor at the Principal Office of the Registrar and the Registrar shall authenticate and deliver in exchange for such temporary Bonds an equal aggregat e principal amount of definitive Bonds of the same Series, matu rity and tenor and of authorized denominations. Until so exchanged , the temporary Bonds shall be entitled to the same benef its under this Indenture as definitive Bonds authenticated and del ivered hereunder. § 2.09. Bonds Mutilated. Lost. Destroyed or Stole n. If any Bond shall become mutilated, the Government , at the expense of the Holder of said Bond, shall execute, and the Registrar shall thereupon authenticate and deliver, a new Bond of like tenor and number in exchange and substitution for the

rnment , at the expense of the Holder of said Bond, shall execute, and the Registrar shall thereupon authenticate and deliver, a new Bond of like tenor and number in exchange and substitution for the Bond so mutilated, but only upon surrender to the Truste e of the Bond so mutilated. Every mutilated Bond so surrendered t o the Registrar shall be canceled by it and delivered to, or upon the Order of, the Government. If any Bond shall be lost , destroyed or stolen, evidence of such loss, destruction or theft may be submitted to the Government and the Registrar and, if such evidence be satisfactory to both and indemnity sati sfactory to both shall be given, the Government, at the expense of t he Holder, shall execute, and the Registrar shall thereupon authenti cate and deliver, a new Bond of like tenor and number in lie u of and in substitution for the Bond so lost, destroyed or sto len (or if any such Bond shall have matured or shall be about to m ature, instead of issuing a substitute Bond, the Trustee may pay t he same without surrender thereof). The Government may require paym ent of a sum not exceeding the actual cost of preparing each new Bond issued under THIS Section and of

Bond, the Trustee may pay t he same without surrender thereof). The Government may require paym ent of a sum not exceeding the actual cost of preparing each new Bond issued under THIS Section and of the expenses which may be incurred by the Government and the Registrar in the premises. Any Bond issued under the provisions of THIS Sectio n in lieu of any Bond alleged to be lost, destroyed or stolen sh all constitute an original additional contractual obligation on the p art of the Government whether or not the Bond so alleged to be lost, destroyed or stolen be at any time enforceable by a nyone, and shall be equally and proportionately entitled to th e benefits of THIS Indenture with all other Bonds secured by THIS Indenture. § 2.10. Book-entry System. COL4/6/20225 GCA GOVERNMENT OPERATIONS CH. 22 GENERAL FISCAL POLICIES AND CONTROLS 135 Notwithstanding any of the other provisions of THI S Article II to the contrary, unless otherwise provided in a Supplemental Indenture providing for the issuance of any Series of Bonds, the Bonds shall be initially issued in the form of a se parate single fully registered Bond for each maturity of each Series; t he ownership of the Bonds shall be

the issuance of any Series of Bonds, the Bonds shall be initially issued in the form of a se parate single fully registered Bond for each maturity of each Series; t he ownership of the Bonds shall be registered in the registratio n books kept by the Registrar in the name of Cede & Co., as nominee of The Depository Trust Company, New York, New York, and i ts successors and assigns (DTC); and the Bonds shall b e governed by the provisions of this Section. (A) Except as provided in a Supplemental Indenture , in this paragraph and in paragraph (C) of THIS Section, all of the Outstanding Bonds shall be registered in the regist ration books kept by the Registrar in the name of Cede & Co., as nominee of DTC. With respect to the Bonds registered in the re gistration books kept by the Registrar in the name of Cede & C o., as nominee of DTC, the Government, the Trustee, the Re gistrar and the Depositary shall have no responsibility or obli gation to any broker-dealers, banks and other financial instituti ons from time to time for which DTC holds Bonds as a securities depo sitory (each a 'Participant') or to any person on behalf of whic h a Participant holds an interest in the Bonds.

nancial instituti ons from time to time for which DTC holds Bonds as a securities depo sitory (each a 'Participant') or to any person on behalf of whic h a Participant holds an interest in the Bonds. Without limiting th e immediately preceding sentence, the Government, the Trustee, th e Registrar and the Depositary shall have no responsibility or obligation with respect to (I) the accuracy of the records of DTC, Cede & Co. or any Participant with respect to any ownership inter est in the Bonds, (ii) the delivery to any Participant or any other person, other than a Bondholder, as shown in the registrati on books kept by the Registrar of any notice with respect to the Bonds, including any notice of redemption, or (iii) the payment to a ny Participant or any other person, other than a Bondholder, as sh own in the registration books kept by the Registrar of any amo unt with respect to principal of or interest on the Bonds. T he Government, the Trustee, the Registrar and the Depositary may t reat and consider the person in whose name each Bond is regi stered in the registration books kept by the Registrar as the hol der and absolute owner of such Bond for the purpose of payment of pr

y t reat and consider the person in whose name each Bond is regi stered in the registration books kept by the Registrar as the hol der and absolute owner of such Bond for the purpose of payment of pr incipal and interest with respect to such Bond, for the purpose of giving notices of redemption and other matters with respec t to such Bond, COL4/6/20225 GCA GOVERNMENT OPERATIONS CH. 22 GENERAL FISCAL POLICIES AND CONTROLS 136 for the purpose of registering transfers with respe ct to such Bond, and for all other purposes whatsoever. The Paying a gent shall pay all principal of and interest on the Bonds only to or upon the order of the respective Bondholders, as shown in the regi stration books kept by the Registrar as provided in § 2.06, or the ir respective attorneys duly authorized in writing, and all such payments shall be valid and effective to fully satisfy and dischar ge the Government’s obligations with respect to payment of principal of and interest on the Bonds to the extent of the sum or sums so paid. No person other than a Bondholder, as shown in the registration books kept by the Registrar, shall receive a certif icated Bond evidencing the obligation of the Government to

the sum or sums so paid. No person other than a Bondholder, as shown in the registration books kept by the Registrar, shall receive a certif icated Bond evidencing the obligation of the Government to make payments of principal and interest pursuant to THIS Certific ate. Upon delivery by DTC to the Government or the Trustee of written notice to the effect that DTC has determined to sub stitute a new nominee in place of Cede & Co., and subject to the provisions herein with respect to record dates, the words 'Ced e & Co.' in THIS Certificate shall refer to such new nominee of DTC. (B) The delivery of any representation letter or o ther instrument by the Government to DTC shall not in an y way limit the provisions of paragraph (A) of this Section or in any other way impose upon the Government any obligation whatsoeve r with respect to persons having interests in the Bonds ot her than the Bondholders, as shown on the registration books kep t by the Registrar. The Registrar shall take all action nece ssary for all representations of the Government in the-Representa tion Letter with respect it, the Registrar to at all times be c omplied with.

the Registrar. The Registrar shall take all action nece ssary for all representations of the Government in the-Representa tion Letter with respect it, the Registrar to at all times be c omplied with. (C) DTC may determine to discontinue providing its services with respect to the Bonds at any time by giving rea sonable notice to the Government or the Registrar and discharging its responsibilities with respect thereto under applica ble law. The Government, in its sole discretion and without the consent of any other person, may terminate the services of DTC wit h respect to the Bonds. Upon the discontinuance or termination o f the services of DTC with respect to the Bonds, unless a substit ute securities depository is appointed to undertake the functions of DTC hereunder, the Government is obligated to deliver B ond certificates at the expense of the beneficial owner s of the Bonds, as described in this Certificate, and the Bonds sha ll no longer be COL4/6/20225 GCA GOVERNMENT OPERATIONS CH. 22 GENERAL FISCAL POLICIES AND CONTROLS 137 restricted to being registered in the registration books kept by the Registrar in the name of Cede & Co.

nger be COL4/6/20225 GCA GOVERNMENT OPERATIONS CH. 22 GENERAL FISCAL POLICIES AND CONTROLS 137 restricted to being registered in the registration books kept by the Registrar in the name of Cede & Co. as nominee of D TC, but may be registered in whatever name or names Bondholders transferring or exchanging Bonds shall designate, in accordance with the provisions of this Indenture. (D) Notwithstanding any other provision of this Ce rtificate to the contrary, so long as any Bond is registered in the name of Cede & Co., as nominee of DTC, all payments with re spect to principal and interest on such Bond and all notices with respect to such Bond shall be made and given, respectively, in the manner provided in any agreement between the Government an d DTC. Bondholders shall have no lien or security interest in any rebate or refund paid by DTC to the Paying agent which ari ses from the payment by the Paying agent of principal of or inte rest on the Bonds in immediately available funds to DTC. ---------- ARTICLE III ISSUE OF BONDS ; APPLICATION OF PROCEEDS § 3.01. Issuance. Sale and Delivery of 1997 Series A Bonds.

incipal of or inte rest on the Bonds in immediately available funds to DTC. ---------- ARTICLE III ISSUE OF BONDS ; APPLICATION OF PROCEEDS § 3.01. Issuance. Sale and Delivery of 1997 Series A Bonds. Upon the sale and execution thereof by the Governm ent, the Registrar shall authenticate and, upon receipt by t he Trustee of the proceeds thereof, deliver, to or upon the Order of the Government, 1997 Series A Bonds in the aggregate principal amou nt of _______________________________ Dollars ($_________ __). § 3.02. Application of Proceeds of 1997 Series A Bo nds and Other Amounts. The proceeds received from the issuance of the 199 7 Series A Bonds shall be deposited in trust with the Truste e, who shall forthwith (1) transfer $________of such proceeds to First Hawaiian Bank, as Trustee for the Government of Gua m Limited Obligation Infrastructure Improvement Bonds, 1989 S eries A (the Series 1989 Bonds), to be held for payment and disc harge of the Series 1989 Bonds; (2) transfer $__________ of such proceeds to Bank of Hawaii, to repay the loan (the 'Bank Loan') made by such bank to the Government pursuant to that certai n Loan COL4/6/20225 GCA GOVERNMENT OPERATIONS CH.

nsfer $__________ of such proceeds to Bank of Hawaii, to repay the loan (the 'Bank Loan') made by such bank to the Government pursuant to that certai n Loan COL4/6/20225 GCA GOVERNMENT OPERATIONS CH. 22 GENERAL FISCAL POLICIES AND CONTROLS 138 Agreement dated as of June ____, 1997, relating to the Bank Loan, and (3) set aside the balance of such proceeds in t he following respective funds and amounts and in the following o rder of priority: (A) in the Bond Fund, $_______, representing the am ount of interest accrued to the date of delivery of the 199 7 Series A Bonds; (B) in the Bond Reserve Fund ,$_____, representing a portion of the amount required to establish the amo unt in the Bond Reserve Fund at the Bond Reserve Fund Requirement; and (C) in the Construction Fund held by the Depositary , the balance of said proceeds. In addition, the Trustee shall deposit, from transf erred proceeds of the Series 1989 Bonds and the Bank Loan , the following amounts in the following respective funds : (i) in the Bond Reserve Fund, $ ______, representin g the amount required to increase the amount in the B ond Reserve Fund to the Bond Reserve Fund Requirement; and (ii) in the Construction Fund

ds : (i) in the Bond Reserve Fund, $ ______, representin g the amount required to increase the amount in the B ond Reserve Fund to the Bond Reserve Fund Requirement; and (ii) in the Construction Fund the balance of such transferred proceeds. § 3.03. Establishment and Application of Constructi on Fund. (A) The Depositary shall establish and maintain an d hold in trust a separate fund designated as the 'Constructi on Fund.' Amounts in the Construction Fund shall be used and withdrawn, as provided in THIS Section, solely for (1) the pur pose of implementing Infrastructure Improvement projects pu rsuant to the Act, and (2) the payment of Costs of Issuance and p remium or fees of any Credit Provider and fees and expenses of cou nsel to any Credit Provider. The Depositary shall disburse mone ys in the Construction Fund for the purposes of clauses (1) a nd (2) of the preceding sentence only upon Requisition of the Gov ernment stating the person to whom payment is to be made, t he amount to be paid, the purpose for which the obligation was i ncurred and that such payment is a proper and lawful charge against said fund.

ent stating the person to whom payment is to be made, t he amount to be paid, the purpose for which the obligation was i ncurred and that such payment is a proper and lawful charge against said fund. Upon receipt of a Certificate of the Government tha t amounts in said fund are no longer required for the purpose of said fund, said amounts shall be transferred to the Revenue Fund. COL4/6/20225 GCA GOVERNMENT OPERATIONS CH. 22 GENERAL FISCAL POLICIES AND CONTROLS 139 (B) The Government may provide in the Supplemental Indenture providing for the issuance of an addition al Series of Bond (1) that the unused proceeds of such additiona l Series as of a date specified by such Supplemental Indenture sha ll be used to redeem the Bonds of such Series, or (2) that the pr oceeds of such additional Series shall otherwise be limited as to use or application. § 3.04. Issuance of Additional Series of Bonds. (A) In addition to the 1997 Series A Bonds, the Go vernment may by supplemental Indenture establish one or more other Series of Bonds, payable from and secured by the assets pl edged by THIS Indenture on a parity with Bonds previously is sued, and the Government may issue, and the Registrar

tablish one or more other Series of Bonds, payable from and secured by the assets pl edged by THIS Indenture on a parity with Bonds previously is sued, and the Government may issue, and the Registrar may authent icate and deliver to the purchasers thereof Bonds of any Seri es so established, in such principal amount as shall be d etermined by the Government but only upon compliance by the Gove rnment with the provisions of § 3.05 and any additional re quirements set forth in said Supplemental Indenture, and subject t o the following specific conditions, which are hereby made conditio ns precedent to the issuance of any such additional Series of Bo nds: (1) No Event of Default shall have occurred and the n be continuing. (2) The Supplemental Indenture providing for the issuance of such additional Series of Bonds shall s pecify the purposes for which such Series is being issued, whi ch shall be one or both of the following (a) to provide mone ys for deposit into the Construction Fund and withdrawal t herefrom in accordance with law for purposes other than the refunding of Bonds, or (b) to refund all or part of the Bonds of any one or more Series then Outstanding, by depositing with

d withdrawal t herefrom in accordance with law for purposes other than the refunding of Bonds, or (b) to refund all or part of the Bonds of any one or more Series then Outstanding, by depositing with the Trustee, in trust, moneys or noncallable Investment Securities constituting direct obligations of the U nited States in the necessary amount to discharge all liability of the Government with respect to the Bonds to be refunded as provided in § 10.02. (3) The Supplemental Indenture providing for the issuance of such additional Series of Bonds also sh all provide COL4/6/20225 GCA GOVERNMENT OPERATIONS CH. 22 GENERAL FISCAL POLICIES AND CONTROLS 140 for such deposit as may be necessary to increase th e balance in the Bond Reserve Fund to an amount at least equa l to the Bond Reserve Fund Requirement with respect to all S eries of which any Bonds will be Outstanding upon the issuan ce of such additional Series of Bonds. Said deposit may b e made from the proceeds of sale of such additional Series of Bonds or any other lawful source, as provided in said Sup plemental Indenture. (4) Fixed serial maturities or Mandatory Sinking Account Payments, or any combination thereof, shall be

tional Series of Bonds or any other lawful source, as provided in said Sup plemental Indenture. (4) Fixed serial maturities or Mandatory Sinking Account Payments, or any combination thereof, shall be established in amounts sufficient to provide for th e retirement of all of the Bonds of such additional Series on or before their respective maturity dates. (5) The aggregate principal amount of Bonds issued hereunder shall not exceed any limitation imposed b y law or by any Supplemental Indenture. (6) Interest payment dates for such additional Seri es shall be on either or both Interest Payment Dates, and maturity dates and Mandatory Sinking Account Paymen t dates shall be on Principal Payment Dates. (7) The amount of Hotel Room Taxes for any consecutive twelve month period out of the eighteen months next preceding the date of execution of the Supplem ental Indenture providing for the issuance of such additi onal Series of Bonds, as shown by a Certificate of the Governme nt (and, if appropriate, making the assumption set forth in the following sentence), have been (or would have been) an amount equal to at least the sum of (a) annual Bond Expenses projected to be budgeted to be paid

opriate, making the assumption set forth in the following sentence), have been (or would have been) an amount equal to at least the sum of (a) annual Bond Expenses projected to be budgeted to be paid from Revenues, plus (b) one hundred fifty percent (150%) of Annual Debt Ser vice on the Bonds; all as computed for the Bond Year in whi ch such sum shall be largest upon and after the issuance of such additional Series of Bonds. If the rate or rates at which Hotel Taxes are levied has been modified since the commen cement of such twelve month period, the Certificate of the Government shall assume that Hotel Room Taxes were collected at such rates as have been enacted and ar e effective as of the date of execution of such Supplemental In denture. COL4/6/20225 GCA GOVERNMENT OPERATIONS CH. 22 GENERAL FISCAL POLICIES AND CONTROLS 141 (B) Nothing in this Section or in this Indenture co ntained shall prevent or be construed to prevent the Supple mental Indenture providing for the issuance of an addition al Series of Bonds from pledging or otherwise providing, in addi tion to the security given or intended to be given by this Inde nture, additional security for the benefit of all Bonds,

f an addition al Series of Bonds from pledging or otherwise providing, in addi tion to the security given or intended to be given by this Inde nture, additional security for the benefit of all Bonds, such additio nal Series of Bonds or any portion of such additional Series of B onds. (C) Nothing in this Section or in this Indenture sh all affect any provision of any Credit Agreement requiring the Government to obtain the consent of the Credit Provider or to satisfy any other conditions before issuing an additional Series of B onds. § 3.05. Proceedings for Issuance of Additional Seri es of Bonds. Whenever the Government shall determine to issue a n additional Series of Bonds pursuant to § 3.04, the Government shall enter into a Supplemental Indenture specifyin g the principal amount and prescribing the forms of Bonds of such a dditional Series and providing terms, conditions, distinctive designation, denominations, methods of numbering, date, place or places of payment of principal or Redemption Price, if any, o f and interest on such Bonds, and any other provisions respecting the Bonds of such Series not inconsistent with the terms of this Indenture, and providing for the manner

Redemption Price, if any, o f and interest on such Bonds, and any other provisions respecting the Bonds of such Series not inconsistent with the terms of this Indenture, and providing for the manner of selling the Bonds and o f determining their maturity date or dates, interest rate or raze s, interest payment dates and redemption provisions. Before such additional Series of Bonds shall be iss ued and delivered, the Government shall deliver the followi ng documents to the Trustee: (A) An executed copy of the Supplemental Indenture authorizing such additional Series of Bonds. (B) Originals or certified copies of the instrument s or documents determining any matters specified above a nd left undetermined by such Supplemental Indenture with re spect to such additional Series of Bonds. (C) A Certificate of the Government that the requirements of §§ 3.04(A)(1) and 3.04(A)(7) have b een met. COL4/6/20225 GCA GOVERNMENT OPERATIONS CH. 22 GENERAL FISCAL POLICIES AND CONTROLS 142 (D) In the case of refunding bonds, irrevocable instructions to the Trustee to give notice as provi ded in Article IV of redemption of all Bonds to be redeeme d in connection with such refunding.

142 (D) In the case of refunding bonds, irrevocable instructions to the Trustee to give notice as provi ded in Article IV of redemption of all Bonds to be redeeme d in connection with such refunding. (E) An Opinion of Counsel that the Supplemental Indenture has been duly executed and delivered in accordance with this Indenture; that such additiona l Series of Bonds, when duly executed by the Government and authenticated and delivered by the Registrar, will be valid and binding obligations of the Government; and that upon the delivery of such additional Series of Bonds the agg regate principal amount of Bonds then Outstanding will not exceed the amount permitted by law or by this Indenture. § 3.06. Validity of Bonds. The validity of the authorization and issuance of the Bonds is not dependent on and shall not be affected in an y way by any proceedings taken by the Government, the Trustee or the Depositary with respect to the application of the p roceeds of the Bonds. The recital contained in the Bonds that the same are issued pursuant to the laws of the Government of Guam, inc luding the Act, shall be conclusive evidence of their validity and of compliance with the provisions of

ained in the Bonds that the same are issued pursuant to the laws of the Government of Guam, inc luding the Act, shall be conclusive evidence of their validity and of compliance with the provisions of law in their issu ance. ---------- ARTICLE IV REDEMPTION OF BONDS § 4.01. Terms of Redemption. (A) The 1997 Series A Bonds maturing after _______ __ are subject to redemption prior to their respective sta ted maturities, at the option of the Government, from any source of av ailable funds, on any date on or after ________, _______, as a who le, or in part by such maturity or maturities as may be specified by Request of the Government (and by lot within a maturity), at t he Redemption Prices (expressed as percentages of principal amoun t) set forth in the table below plus interest accrued thereon to th e daze fixed for redemption: COL4/6/20225 GCA GOVERNMENT OPERATIONS CH. 22 GENERAL FISCAL POLICIES AND CONTROLS 143 Redemption Dates Redemption Prices ______, _______ to and including ______, _______ __ _____ % ______, _______ to and including ______, _______ __ _____ % ______, _______ to and including ______, _______ __ _____ % ______, _______ to and including ______, _______ _______ %

, _______ __ _____ % ______, _______ to and including ______, _______ __ _____ % ______, _______ to and including ______, _______ __ _____ % ______, _______ to and including ______, _______ _______ % _______, _______ and thereafter 100 % The Government shall notify the Trustee in writing at least 60 days prior to the date to be fixed for redemptio n of its intention to exercise its redemption option. (B) The 1997 Series A Bonds maturing on Principal P ayment Dazes in __________ and _________, respectively, ar e also subject to redemption prior to their stated maturit ies in part, by lot, from Mandatory Sinking Account Payments established for each such maturity in § 5.03(C), on each Principal Payme nt Date on or after the Principal Payment Date in ___________ or ___________, respectively, at the principal amount thereof plus interest accrued thereon to the date fixed for rede mption, without premium. (C) Any Series of Bonds, other than the 1997 Series A Bonds, may be made subject to redemption prior to maturity , as a whole or in part, at such time or times, upon payment of the principal amount thereof and interest accrued thereon to the date fixed for redemption plus such premium

demption prior to maturity , as a whole or in part, at such time or times, upon payment of the principal amount thereof and interest accrued thereon to the date fixed for redemption plus such premium or premiums, if any, a nd upon such terms (in addition to and consistent with the terms contained in THIS Article) as may be determined by the Govern ment at the time such Series is authorized or sold. § 4.02. Selection of Bonds for Redemption. For purposes of selecting Bonds for redemption, Bo nds shall be deemed to be composed of $5,000 portions, and an y such portion may be separately redeemed. The Trustee sha ll promptly notify the Government in writing of the Bonds or po rtions thereof selected for redemption. In the event that less tha n all of the Bonds are to be redeemed, the Bonds or such manner as the Trustee may determine. The amount of each maturity of the 1997 Series A COL4/6/20225 GCA GOVERNMENT OPERATIONS CH. 22 GENERAL FISCAL POLICIES AND CONTROLS 144 Bonds to be redeemed pursuant to § 4.01(A) shall be determined by Request of the Government, and the amount of eac h maturity of Bonds of any ocher Series to be redeemed pursuan t to the optional redemption provisions

ed pursuant to § 4.01(A) shall be determined by Request of the Government, and the amount of eac h maturity of Bonds of any ocher Series to be redeemed pursuan t to the optional redemption provisions applicable to such S eries shall be determined as provided in the Supplemental Indentur e providing for the issuance of such Series. § 4.03. Notice of Redemption. Notice of redemption (except as provided below) sh all be given, not less than thirty (30) nor more than sixt y (60) days before the date fixed for redemption, by first class mail to each of the registered owners of Bonds designated for redemptio n at their addresses appearing on the bond registration books of the Registrar provided to the Trustee on the date the B onds to be redeemed are selected. Each notice of redemption sh all state the redemption date, the place or places of redemption, the Series and maturities to be redeemed, and, if less than all of any such maturity, the numbers of the Bonds of such maturity to be redeemed and, in the case of Bonds to be redeemed i n part only, the respective portions of the principal amount the reof to be redeemed, and shall also state that on said daze th ere will become due and

emed and, in the case of Bonds to be redeemed i n part only, the respective portions of the principal amount the reof to be redeemed, and shall also state that on said daze th ere will become due and payable on each of said Bonds the Redemptio n Price thereof or of said specified portion of the princip al thereof in the case of a Bond to be redeemed in part only, togethe r with interest accrued thereon to the redemption date, and that fr om and after such redemption daze interest thereon shall cease t o accrue, and shall require that such Bonds be then surrendered, with a written instrument of transfer duly executed by the registe red owner thereof or by such registered owner’s attorney duly authorized in writing. No defect in or failure to give such maile d notice of redemption shall affect the validity of proceedings for the redemption of such Bonds. Each notice of redemption shall also state the CUSP number, date of issue and interest r ate on each Bond, or portion thereof, to be redeemed, and shall include the redemption agent name and address with contact pers on and telephone number; provided, however, that failure b y the Trustee to include any of such information in any

redeemed, and shall include the redemption agent name and address with contact pers on and telephone number; provided, however, that failure b y the Trustee to include any of such information in any redemptio n notice, or any inaccuracy in any such information, shall not a ffect the sufficiency of the proceedings for redemption of an y Bonds. COL4/6/20225 GCA GOVERNMENT OPERATIONS CH. 22 GENERAL FISCAL POLICIES AND CONTROLS 145 A copy of any notice of redemption given pursuant t o the foregoing paragraph shall also be sent by certified mail, with return receipt requested, to the holders of $1,000, 000 or more in aggregate principal amount of Bonds to be redeemed and to each of the Fiduciaries, each of the Credit Providers, t he Securities Depositories (as defined below) and two or more Inf ormation Services (as defined below); provided, however, tha t failure by the Trustee to give notice pursuant to this sentence by certified mail to any Bondholders, to any Fiduciaries, to any Cred it Providers or to any Securities Depositories or Information Servi ces, or the insufficiency of any such notices, shall not affect the sufficiency of the proceedings for redemption of any Bonds.

red it Providers or to any Securities Depositories or Information Servi ces, or the insufficiency of any such notices, shall not affect the sufficiency of the proceedings for redemption of any Bonds. A s econd notice shall be sent, by certified mail with return receip t requested, to the registered owner of any Bond which has been called for redemption in whole or in part, and is not surrende red for payment within sixty (60) days after the date fixed for red emption; provided, however, that failure by the Trustee to s end any such second notice, or any deficiency of any such notice , shall not affect the sufficiency of the proceedings for redem ption of any Bonds. As used in this paragraph, the term Informat ion Services means Financial information, Inc.’s ‘Daily Called B ond Service,’ 30 Montgomery Street, 10th Floor, Jersey City, New Jersey 07302. Attention: Editor; Kenny information Service s’ 'Called: Bond Service,' 55 Broad Street, 28th Floor, New Yor k, New York 10004; Moody’s ‘Municipal and Government, 99 Church Street, 8th Floor, New York, New York 10007, Attention: Mun icipal News Reports; and Standard and Poor’s 'Called Bond Record,' 25 Broadway, 3rd Floor, New York,

s ‘Municipal and Government, 99 Church Street, 8th Floor, New York, New York 10007, Attention: Mun icipal News Reports; and Standard and Poor’s 'Called Bond Record,' 25 Broadway, 3rd Floor, New York, New York 10004; o r, in accordance with then-current guidelines of the Secu rities and Exchange Commission, and/or such other services pro viding information with respect to ailed bonds, or no such services, as the Government may designate in a Certificate delivered to the Trustee; and the term Securities Depositories means : The Depository Trust Company, 711 Stewart Avenue, Garde n City, New York 11530, Fax-(516) 227-4039 or 4190; Midwest Securities Trust Company, Capital Structures-Call N otification, 440 South LaSalle Street, Chicago, Illinois 60605, Fax-(312) 663- 2343; Pacific Securities Depository Trust Company, Pacific and Company, P.O. Box 7041, San Francisco, California 9 4120, Fax- (415) 393-4128; Philadelphia Depository Trust Compa ny, COL4/6/20225 GCA GOVERNMENT OPERATIONS CH. 22 GENERAL FISCAL POLICIES AND CONTROLS 146 Reorganization Division, 1900 Market Street, Philad elphia, Pennsylvania 19103, Attention: Bond Department, Dex -(215) 496-5058; or, in accordance with

CH. 22 GENERAL FISCAL POLICIES AND CONTROLS 146 Reorganization Division, 1900 Market Street, Philad elphia, Pennsylvania 19103, Attention: Bond Department, Dex -(215) 496-5058; or, in accordance with then-current guide lines of the Securities and Exchange Commission, and/or such oth er securities depositories, or no such depositories, as the Gover nment may designate in a Certificate delivered to the Trustee . Notice of redemption of Bonds shall be given by the Trustee for and on behalf of the Government. Notice of redemption of 1997 Series A Bonds pursuan t to § 4.01(A) may be conditioned upon the deposit with the Trustee of proceeds of refunding obligations of the Governm ent or other funds in an amount sufficient to pay the Redemption Price of and accrued interest on such Bonds to the date fixed fo r redemption, and may be rescinded upon the failure of such condi tion. § 4.04. Partial Redemption. Upon surrender of any Bond redeemed in part only, the Government shall execute and the Registrar shall au thenticate and deliver to the registered owner thereof, at the exp ense of the Government, a new Bond or Bonds of authorized denom inations, and of the same Series, maturity and

he Registrar shall au thenticate and deliver to the registered owner thereof, at the exp ense of the Government, a new Bond or Bonds of authorized denom inations, and of the same Series, maturity and tenor, equal i n aggregate principal amount to the unredeemed portion of the B ond surrendered. § 4.05. Effect of Redemption. Notice of redemption having been duly given as afo resaid, and moneys being held by the Trustee for payment of the Redemption Price of, and interest accrued to the re demption date on, the Bonds (or portions thereof) so called for r edemption on the redemption date designated in such notice, such Bon ds (or such portions) shall become due and payable at the Redem ption Price specified in such notice plus interest accrued ther eon to the date fixed for redemption, interest on the Bonds so call ed for redemption shall cease to accrue, said Bonds (or po rtions thereof) shall cease to be entitled to any benefit or securi ty under this Indenture, and the Holders of said Bonds shall have no rights in respect thereof except to receive payment of said R edemption Price and accrued interest. COL4/6/20225 GCA GOVERNMENT OPERATIONS CH.

s Indenture, and the Holders of said Bonds shall have no rights in respect thereof except to receive payment of said R edemption Price and accrued interest. COL4/6/20225 GCA GOVERNMENT OPERATIONS CH. 22 GENERAL FISCAL POLICIES AND CONTROLS 147 All Bonds purchased or redeemed pursuant to the pro visions of this Indenture shall be canceled upon surrender thereof and delivered to or upon the Order of the Government. ---------- ARTICLE V REVENUES § 5.01. Pledge and Assignment: Revenue Fund. (A) Subject only to the provisions of this Indentu re permitting the application thereof for or to the pu rposes and on the terms and conditions set forth herein, there are he reby pledged to secure the payment of the principal of and interest on the Bonds in accordance with their terms and the provisions o f this Indenture, all of the Hotel Room Taxes, all of the Revenues (e xcept to the extent of the Rebate Requirement referred to in§ 5. 08), and any other amounts held in any fund or account establish ed pursuant to this Indenture (except the Rebate Fund and the Cons truction Fund). Said pledge shall constitute a first lien on and security interest in such assets and shall attach, be perfec ted

sh ed pursuant to this Indenture (except the Rebate Fund and the Cons truction Fund). Said pledge shall constitute a first lien on and security interest in such assets and shall attach, be perfec ted and be valid and binding from and after delivery by the Registra r of the 1997 Series A Bonds, without any physical delivery there of or further act. (B) The Government shall deposit all Revenues upon the receipt thereof in a special fund designated as the 'Revenue Fund', which the Depositary shall establish and mai ntain and hold in trust, except that all interest and other profit from the investment of moneys in the Construction Fund shall be retained therein. The Trustee and the Depositary shall be en titled to and shall collect and receive all of the Revenues, and any Revenues collected or received by the Government shall be de emed to be held, and to have been collected or received, by th e Government as the agent of the Trustee and Depositary and shal l forthwith be paid by the Government to the Depositary. (C) (1) The Trustee shall establish, maintain and h old in trust the following additional funds: (a) the Bond Fund; COL4/6/20225 GCA GOVERNMENT OPERATIONS CH.

aid by the Government to the Depositary. (C) (1) The Trustee shall establish, maintain and h old in trust the following additional funds: (a) the Bond Fund; COL4/6/20225 GCA GOVERNMENT OPERATIONS CH. 22 GENERAL FISCAL POLICIES AND CONTROLS 148 (b) the Bond Reserve Fund; (c) the Bond Expense Fund; and (d) the Rebate Fund. (D) All moneys at any time deposited with the Trust ee or the Depositary, as the case may be, shall be held by th e Trustee or the Depositary, as the case may be in trust for the ben efit of the Holders at any time of the Bonds (and, to the exten t of the payment of any of the Bonds from amounts received under a C redit Facility, for the benefit of the applicable Credit Provider, subordinate in all respects to the Holders of all o f the Bonds), and the Government shall have no beneficial right or in terest in any of such moneys; except as in this Indenture provided. All Revenues so deposited shall be held, disbursed, allocated an d applied only as provided in this Indenture. § 5.02. Allocation of Revenues. On or before the [fifth] day of each calendar mont h following the calendar month in which the 1997 Series A Bonds are delivered, the Depositary shall transfer

enture. § 5.02. Allocation of Revenues. On or before the [fifth] day of each calendar mont h following the calendar month in which the 1997 Series A Bonds are delivered, the Depositary shall transfer from the R evenue Fund (to the Trustee as necessary), for deposit into one or more of the following respective separate funds, the following amounts in the following order of priority, the requirements of ea ch such fund or account (including the making up of any deficiencie s in any such fund or account resulting from lack of Revenues suf ficient to make any earlier required deposit) at the time of d eposit to be satisfied, and the results of such satisfaction bei ng taken into account, before any transfer is made to any account subsequent in priority: (A) into the Bond Fund held by the Trustee, an amou nt equal to the sum of (1) the aggregate amount of int erest to accrue on the Bonds during the next succeeding cale ndar month upon all Bonds then Outstanding, plus (2) an amount which, if paid in equal monthly installments in eac h month prior to the next Principal Payment Date, would agg regate to the amount of principal becoming due and payable on the Outstanding Serial Bonds on

if paid in equal monthly installments in eac h month prior to the next Principal Payment Date, would agg regate to the amount of principal becoming due and payable on the Outstanding Serial Bonds on such Principal Payment Date, plus (3) an amount which, if paid in equal monthly installments in each month prior to the next Princi pal COL4/6/20225 GCA GOVERNMENT OPERATIONS CH. 22 GENERAL FISCAL POLICIES AND CONTROLS 149 Payment Date, would aggregate to the aggregate amou nt of Mandatory Sinking Account Payments required to be p aid for the Outstanding Term Bonds on such Principal Paymen t Date; (B) into the Rebate Fund held by the Trustee, the amount, if any, required to be deposited therein pu rsuant to § 5.08; (C) into the Bond Reserve Fund held by the Trustee, the amount, if any, needed to increase the amount in th e Bond Reserve Fund to the Bond Reserve Fund Requirement; (D) into the Bond Expense Fund held by the Trustee, an amount equal to the amount of Bond Expenses estimat ed by the Trustee to be due and payable (or, in the case of Bond Expenses payable semiannually or on some other peri odic basis, to accrue) during the next succeeding calend ar month; and [(E) to the funds

the Trustee to be due and payable (or, in the case of Bond Expenses payable semiannually or on some other peri odic basis, to accrue) during the next succeeding calend ar month; and [(E) to the funds and accounts designated by subsec tions ______ (c)(1) and (2) of the Act, the amounts deter mined in accordance with said subsections, as they may from time to time be amended, all as specified by the budget fil ed by the Government pursuant to § 6.12 hereof]. § 5.03. Application of Bond Fund. (A) Subject to subsection CD) of this Section, all amounts m the Bond Fund shall be used and withdrawn by the Tr ustee solely for the purpose of (1) paying interest on the Bonds as it shall become due and payable (including accrued interest on any Bonds purchased or redeemed prior to maturity pursuant to this Indenture), (2) paying the principal of the Serial Bonds when due and payable, and (3) purchasing or redeeming or pay ing at maturity the Term Bonds as provided in this Section . (B) Subject to subsection (D) of this Section, on e ach Mandatory Sinking Account Payment date, the Trustee shall apply the Mandatory Sinking Account Payment or Payments r equired on that date to the redemption (or

subsection (D) of this Section, on e ach Mandatory Sinking Account Payment date, the Trustee shall apply the Mandatory Sinking Account Payment or Payments r equired on that date to the redemption (or payment at matur ity, as the ease may be) of the applicable Term Bonds upon the notic e and in the manner provided in Article IV. At any time prior to giving such COL4/6/20225 GCA GOVERNMENT OPERATIONS CH. 22 GENERAL FISCAL POLICIES AND CONTROLS 150 notice of such redemption, the Trustee, upon the Re quest of the Government, shall apply moneys in the Bond Fund, in an amount not in excess of such Mandatory Sinking Account Pay ment, to the purchase of the applicable Term Bonds at public or private sale, as and when and at such prices (including brokerage and other charges) as are specified in such Request, except t hat the purchase price (excluding accrued interest) shall not exceed the price that would be payable for such Bonds upon redemption by application of such Mandatory Sinking Account Payment. (C) Subject to the terms and conditions set forth i n subsections (B) and CD) of this Section and in § 4.

able for such Bonds upon redemption by application of such Mandatory Sinking Account Payment. (C) Subject to the terms and conditions set forth i n subsections (B) and CD) of this Section and in § 4. 01(B), Term 1997 Series A Bonds shall be redeemed (or paid at m aturity, as the case may be) by application of Mandatory Sinkin g Account Payments for such Bonds, in the amounts (after givi ng effect to the credits provided for in this Section) and upon the Principal Payment Dates in the years hereinafter set forth: Mandatory Sinking Account Payments for Bonds Due ____________, 200__ Year Amount Year Amount Mandatory Sinking Account Payments for Bonds Due ____________, 200__ Year Amount Year Amount Upon the redemption of Term 1997 Series A Bonds pur suant to § 4.01(A), the principal amount of such Bonds sh all be credited against remaining Mandatory Sinking Account Payment s in such manner as may be designated by Request of the Gover nment, provided that Mandatory Sinking Account Payments sh all remain as integral multiples of $5,000. If, (1) during the twelve-month period immediately preceding a Mandatory Sinking Ac count Payment date the Trustee purchases the applicable T erm Bonds

sh all remain as integral multiples of $5,000. If, (1) during the twelve-month period immediately preceding a Mandatory Sinking Ac count Payment date the Trustee purchases the applicable T erm Bonds with moneys in the Bond Fund, or (2) during said pe riod and prior to giving said notice of redemption the Government otherwise deposits the applicable Term Bonds with the Trustee (together COL4/6/20225 GCA GOVERNMENT OPERATIONS CH. 22 GENERAL FISCAL POLICIES AND CONTROLS 151 with a Request of the Government to apply such Bond s so deposited to the Mandatory Sinking Account Payment due on said date), the amount of Bonds so purchased or deposite d shall be credited the time of such purchase or deposit, to t he extent of the full principal amount thereof, to reduce such Manda tory Sinking Account Payment. All Bonds purchased or deposited p ursuant to this subsection shall be canceled and delivered by the Trustee to or upon the Order of the Government. § 5.04. Application of Bond Reserve Fund. All amounts in the Bond Reserve Fund shall be used and withdrawn by the Trustee solely for the purpose of making up any deficiency in the Bond Fund in the manner and to th e extent set forth in §

nd. All amounts in the Bond Reserve Fund shall be used and withdrawn by the Trustee solely for the purpose of making up any deficiency in the Bond Fund in the manner and to th e extent set forth in § 5.06. Upon the Request of the Government , any amount in the Bond Reserve Fund in excess of the Bond Rese rve Fund Requirement may be transferred to the Revenue Fund on the fifth day after any Principal Payment Date. If and to the extent provided by a Supplemental Ind enture authorizing the issuance of an additional Series of Bonds and with respect to the 1997 Series A Bonds, the portion of the Bond Reserve Fund Requirement allocable to such Series m ay be wholly or partially satisfied by a Credit Facility. Notwithstanding anything to the contrary contained hereinbefore in this Section or in Article IV, such Supplemental Indenture may also provide, and with respect to the 1997 Series A Bonds this Indent ure hereby provides, that if a drawing or claim on such Credit Facility is honored, amounts available under § 5.02(C) for depo sit in the Bond Reserve Fund shall be applied by the Trustee t o reimburse, as soon as practicable, the amount of each payment honoring such drawing or claim,

ounts available under § 5.02(C) for depo sit in the Bond Reserve Fund shall be applied by the Trustee t o reimburse, as soon as practicable, the amount of each payment honoring such drawing or claim, and the Trustee shall give any no tice of such reimbursement required by the applicable Credit Agr eement. § 5.05. Application of Bond Expense Fund. All amounts in the Bond Expense Fund shall be used and withdrawn by the Trustee (or by the Government upon Requisition) solely for the purpose of paying Bond Expenses. The Trustee shall disburse moneys in the Bond Expense F und only upon Requisition of the Government stating the pers on to whom payment is to be made, the amount to be paid, the p urpose for COL4/6/20225 GCA GOVERNMENT OPERATIONS CH. 22 GENERAL FISCAL POLICIES AND CONTROLS 152 which the obligation was incurred and that such pay ment is a proper and lawful charge against said Fund. Any exc ess amounts in the Bond Expense Fund shall be transferred by th e Trustee to the Revenue Fund. [None of the amount deposited pur suant to § 3.02(C) shall be treated as excess unless and unt il the original Credit Facility shall have been released or termina ted.] § 5.06.

e to the Revenue Fund. [None of the amount deposited pur suant to § 3.02(C) shall be treated as excess unless and unt il the original Credit Facility shall have been released or termina ted.] § 5.06. Deficiencies in Bond Fund. (A) In the event that on the fifth day before any Interest Payment Date, or if any such day is not a Business Day, on the next preceding Business Day, the amount in the Bond Fund is insufficient to pay the principal of, Mandatory Sin king Account Payments for and interest on such Interest Payment Date, the Trustee or the Depositary upon the direction of the Trustee, as the case may be, shall transfer to the Bond Fund the am ount of such deficiency by withdrawing said amount from the foll owing funds in the following order of priority and prior to any other claims upon such funds: (1) the Revenue Fund, and (2) the Bond Reserve Fund. If after making all such transfers, the amoun t in the Bond Fund is insufficient to pay the principal of or Man datory Sinking Account Payments for or interest on the Bonds due o n the next succeeding Interest Payment Date, the Trustee shall promptly notify each Credit Provider of the amount of such i nsufficiency.

y Sinking Account Payments for or interest on the Bonds due o n the next succeeding Interest Payment Date, the Trustee shall promptly notify each Credit Provider of the amount of such i nsufficiency. (B) The Government may, by Supplemental Indenture providing for the issuance of an additional Series of Bonds, specify earlier dates for the testing of the suffic iency of amounts in the Bond Fund. § 5.07. Investment of Moneys in Funds. All moneys in the funds and accounts established p ursuant to this Indenture, other than the Rebate Fund, shall b e invested by the Trustee or the Depositary, as the case may be, solely in Investment Securities to maximize investment income , with proper regard for the preservation of principal, su bject to any Request of the Government as to such investment. Al l Investment Securities and any other investments acquired with moneys held hereunder shall be acquired subject to the limitati ons set forth in § 6.09, to the limitations as to maturities hereina fter in this Section set forth and to such additional limitations or req uirements COL4/6/20225 GCA GOVERNMENT OPERATIONS CH.

tati ons set forth in § 6.09, to the limitations as to maturities hereina fter in this Section set forth and to such additional limitations or req uirements COL4/6/20225 GCA GOVERNMENT OPERATIONS CH. 22 GENERAL FISCAL POLICIES AND CONTROLS 153 consistent with the foregoing as may be established by Request of the Government. Moneys in the Rebate Fund shall be invested as prov ided in § 5.08 and in the Tax Certificate. Moneys in all funds and accounts established under this Indenture shall be invested in securities paying in terest and maturing not later than the dates on which it is es timated that such moneys will be required by the Trustee or the Depos itary. All interest and other profit derived from such inv estments shall be deposited at least monthly in the Revenue Fund, except that interest and other profit derived from the inv estment of moneys in the Construction Fund or the Rebate Fund shall be retained in such respective fund, investments acqui red as an investment of moneys in any fund or account establi shed under this Indenture shall be credited to such fund or ac count. For the purpose of determining the amount in any fund or ac count, except the Rebate Fund, the

eys in any fund or account establi shed under this Indenture shall be credited to such fund or ac count. For the purpose of determining the amount in any fund or ac count, except the Rebate Fund, the amount of any obligation alloc able to such fund or account shall be equal to the purchase pric e of such obligation (not including accrued interest, if any, paid on the purchase of such obligation) plus the amount of any discount below par accounting for any such discount ratably each year over the term of such obligation (i.e., by dividing the amount of such discount by the number of interest payments remaini ng to maturity and by multiplying the amount so calculated by the number of interest payment dates having passed since the date of purchase) (in this Section called 'amortized value') provided , however, that the amount of any accrued interest on any obligatio n shall be credited to the Revenue Fund or to any fund or acco unt to which such amount or any portion thereof may have been tr ansferred from the Revenue Fund; and provided, further, that the amount of any obligation in the Bond Reserve Fund shall be de termined as of the fifth day after each Principal Payment Date and

en tr ansferred from the Revenue Fund; and provided, further, that the amount of any obligation in the Bond Reserve Fund shall be de termined as of the fifth day after each Principal Payment Date and shall be the then current market value. The Trustee or the Depositary may sell at the best price obtainable, or present for redemption, any Investme nt Securities so purchased whenever it shall be necessary in orde r to provide moneys to meet any required payment, transfer, with drawal or disbursement from the fund or account to which such Investment COL4/6/20225 GCA GOVERNMENT OPERATIONS CH. 22 GENERAL FISCAL POLICIES AND CONTROLS 154 Security is credited, and neither the Trustee nor t he Depositary shall be liable or responsible for any loss resulti ng from such investment. § 5.08. Rebate Funds. (A) In addition to the other funds and accounts cr eated pursuant to this Indenture, the Trustee shall estab lish and maintain a fund separate from any other fund established and maintained hereunder and designated as the 'Rebate Fund.' The Trustee shall also establish and maintain within the Rebate Fund a separate subaccount designated as the '1997 Series A Rebate Account.' There shall be

eunder and designated as the 'Rebate Fund.' The Trustee shall also establish and maintain within the Rebate Fund a separate subaccount designated as the '1997 Series A Rebate Account.' There shall be deposited in the 1997 Series A Rebat e Account from Revenues or other lawfully available moneys su ch amounts as are required to be deposited therein pursuant to the Tax Certificate with respect to the 1997 Series A Bonds . All money at any time deposited in the 1997 Series A Rebate Acco unt shall be held by the Trustee in trust, to the extent require d to satisfy the Rebate Requirement for the 1997 Series A Bonds (as defined in the Tax Certificate with respect to the 1997 Series A Bonds), for payment to the United States of America. All amount s required to be deposited into or on deposit in the 1997 Series A Rebate Account shall be governed exclusively by this Secti on and by the Tax Certificate with respect to the 1997 Series A B onds (which is incorporated herein by reference). (B) The Trustee shall pay to the United States, out of amounts in the 1997 Series A Rebate Account, (1) not later than 30 days after the end of the fif th Bond Year and not less frequently than once each

The Trustee shall pay to the United States, out of amounts in the 1997 Series A Rebate Account, (1) not later than 30 days after the end of the fif th Bond Year and not less frequently than once each five ye ars thereafter, an amount equal to at least 90% of the Rebate Requirement for the 1997 Series A Bonds; and (2) not later than 60 days after the retirement of the 1997 Series A Bonds, an amount equal to 100% of the Reba te Requirement with respect to such Bonds (determined as of the date of the retirement of such Bonds). In the e vent that, prior to the time of any required payment out of th e 1997 Series A Rebate Account, the amount in the 1997 Ser ies A Rebate Account is not sufficient to make such payme nt when such payment is due, the Government shall calculate and COL4/6/20225 GCA GOVERNMENT OPERATIONS CH. 22 GENERAL FISCAL POLICIES AND CONTROLS 155 direct the Trustee to deposit from Revenues or othe r lawfully available moneys an amount equal to such deficiency into the 1997 Series A Rebate Account prior to the time such payment is due. Within thirty (30) days after the end of every fift h Bond Year, and within fifty-five (55) days after the date on w hich no Bonds are

7 Series A Rebate Account prior to the time such payment is due. Within thirty (30) days after the end of every fift h Bond Year, and within fifty-five (55) days after the date on w hich no Bonds are outstanding, the Trustee shall request the Gove rnment to deliver to the Trustee a certificate stating whethe r any rebate payment is required to be made and the amount of an y such rebate payment to be made, as set forth in the Tax Certifi cate, and to deliver to the Trustee any amount so required to be paid. Notwithstanding anything to the contrary in this In denture, any amount received with respect to a Nonpurpose In vestment (as defined in the Tax Certificate with respect to the 1997 Series A Bonds) credited to the 1997 Series A Rebate Account shall be retained in the 1997 Series A Rebate Account upon t he receipt thereof. In the event that on the first day of any Bond Year the amount credited to the 1997 Series A Rebate Account exceed s the Rebate Requirement for the 1997 Series A Bonds, the Truste e shall transfer the excess from the 1997 Series A Rebate A ccount to the Revenue Fund.

ted to the 1997 Series A Rebate Account exceed s the Rebate Requirement for the 1997 Series A Bonds, the Truste e shall transfer the excess from the 1997 Series A Rebate A ccount to the Revenue Fund. For purposes of crediting amounts to the 1997 Serie s A Rebate Account or withdrawing amounts from the 1997 Series A Rebate Account, Nonpurpose Investments shall be val ued in the manner provided in the Tax Certificate with respect to the 1997 Series A Bonds. (C) Notwithstanding any provisions of this Section, if the Government shall provide to the Trustee an Opinion of Counsel that any specified action required under this Secti on is no longer required or that some further or different action i s required to maintain the exclusion from federal income tax of i nterest with respect to any Series of Bonds, the Trustee and the Government may conclusively rely on such opinion in complying with the requirements of this Section, and, notwithstanding Article IX of this Indenture, the covenants hereunder shall be de emed to be modified to that extent. COL4/6/20225 GCA GOVERNMENT OPERATIONS CH. 22 GENERAL FISCAL POLICIES AND CONTROLS 156 § 5.09. Credit Facility.

this Indenture, the covenants hereunder shall be de emed to be modified to that extent. COL4/6/20225 GCA GOVERNMENT OPERATIONS CH. 22 GENERAL FISCAL POLICIES AND CONTROLS 156 § 5.09. Credit Facility. The Trustee hereby agrees to hold each Credit Faci lity for the benefit of the Holders of the related Series of Bon ds. [Appropriate claim/payment provisions to come from Credit Provider] The Government hereby authorizes and directs the Tr ustee to surrender any Credit Facility to the applicable Cre dit Provider on the date of termination thereof as provided in such Credit Facility or in the related Credit Agreement, to surrender an y Credit Facility to the applicable Credit Provider upon receipt of a substitute for such Credit Facility pursuant hereto and to the Cre dit Agreement, and, upon the appointment and qualification of a su ccessor Trustee, to surrender Credit Facilities to the resp ective Credit Providers upon delivery of substitute Credit Facili ties by the respective Credit Providers to such successor Trust ee pursuant to the provisions of the Credit Agreements. Neither su rrender of any Credit Facility by the Trustee nor confirmation in writing of receipt thereof by the

roviders to such successor Trust ee pursuant to the provisions of the Credit Agreements. Neither su rrender of any Credit Facility by the Trustee nor confirmation in writing of receipt thereof by the applicable Credit Provider s hall be deemed to be a condition precedent to any termination of s uch Credit Facility. Before the effective date of any substitute Credit Facility, the Trustee shall send written notice by first class ma il to each of the registered owners of Bonds of the related Series, a t their addresses appearing on the bond registration books of the Reg istrar, stating the identity of the provider of such Credit Facilit y and the effective date and stated termination date thereof. ---------- ARTICLE VI PARTICULAR COVENANTS § 6.01. Punctual Payment. The Government shall punctually pay or cause to be paid, from the Revenues and other assets pledged hereunde r, the principal or Redemption Price and interest to becom e due in COL4/6/20225 GCA GOVERNMENT OPERATIONS CH. 22 GENERAL FISCAL POLICIES AND CONTROLS 157 respect of all the Bonds, in strict conformity with the terms of the Bonds and of this Indenture. § 6.02.

due in COL4/6/20225 GCA GOVERNMENT OPERATIONS CH. 22 GENERAL FISCAL POLICIES AND CONTROLS 157 respect of all the Bonds, in strict conformity with the terms of the Bonds and of this Indenture. § 6.02. Extension of Payment of Principal and Inter est on the Bonds. The Government shall not directly or indirectly ex tend or assent to the extension of the maturity of any of t he Bonds or the time of payment of any of the claims for interest b y the purchase or funding of such Bonds or claims for interest or by any other arrangement; and in case the maturity of any of the Bands or the time of payment of any such claims for interest sha ll be extended, such Bonds or claims for interest shall not be enti tled, in case of any default hereunder, to the benefits of THIS Inde nture, except subject to the prior payment in full of the princip al of all of the Bonds then Outstanding and of all claims for intere st thereon which shall not have been so extended. Nothing in t his Section shall be deemed to limit the right of the Governmen t to issue bonds for the purpose of refunding any Outstanding Bonds, and such issuance shall not be deemed to constitute an extension of maturity of Bonds. § 6.03.

to limit the right of the Governmen t to issue bonds for the purpose of refunding any Outstanding Bonds, and such issuance shall not be deemed to constitute an extension of maturity of Bonds. § 6.03. Limitation on Encumbrances. The Government shall not create, or permit the cre ation of, any pledge, lien, charge or other encumbrance upon the Revenues or other assets pledged or assigned under this Inde nture while any of the Bonds are Outstanding, except the pledge and assignment created by this Indenture or any encumbrance subord inate to the pledge and assignment created hereby, and shall not issue any bonds secured by such pledge and assignment other t han the Bonds; provided that the Government may grant to an y Credit Provider a lien on the Revenues and other assets pl edged hereby, which shall be subordinate in all respects to the p ledge of this Indenture. Subject to this limitation, the Governme nt expressly reserves the right to enter into one or more other indentures for any of its governmental purposes, and reserves the right to issue other obligations for such purposes. § 6.04. Power to Issue Bonds and Make Pledge.

ght to enter into one or more other indentures for any of its governmental purposes, and reserves the right to issue other obligations for such purposes. § 6.04. Power to Issue Bonds and Make Pledge. The Government represents and warrants that it is duly authorized pursuant to law to issue the Bonds and t o enter into this COL4/6/20225 GCA GOVERNMENT OPERATIONS CH. 22 GENERAL FISCAL POLICIES AND CONTROLS 158 Indenture and to pledge the Revenues and other asse ts purported to be pledged under this Indenture in the manner an d to the extent provided in this Indenture. The Bonds and the provi sions of this Indenture are and will be the legal, valid and bind ing limited obligations of the Government in accordance with th eir terms, and the Government, Trustee and Depositary shall at all times, to the extent permitted by law, defend, preserve and prote ct said pledge of Revenues and other assets and all the rights of the Bondholders under this Indenture against all claims and demands of all persons whomsoever. § 6.05. Payment of Taxes and Claims. The Government shall, from time to time, duly pay and discharge, or cause to be paid and discharged, any property taxes, assessments or other

persons whomsoever. § 6.05. Payment of Taxes and Claims. The Government shall, from time to time, duly pay and discharge, or cause to be paid and discharged, any property taxes, assessments or other governmental charges that may be lawfully imposed upon the Revenues or other assets pledged o r assigned under this Indenture, when the same shall become du e, after notice to each Credit Provider and an opportunity to conte st the same, as well as any lawful claim which, if unpaid, might by law become a lien or charge upon the Revenues or such other asse ts or which might impair the security of the bonds. § 6.06. Accounting Records and Financial Statements . The Government shall at all times keep, or cause t o be kept, proper books of record and account in which complet e and accurate entries shall be made of all transactions relating to the proceeds of Bonds, the Revenues, and all funds and accounts established pursuant to this Indenture. Such books of record and account shall be available for inspection by the Tr ustee, the Depositary, any Credit Provider or the Government, as the case may be, and, with respect to such books of record a nd account maintained by the Trustee and the

ble for inspection by the Tr ustee, the Depositary, any Credit Provider or the Government, as the case may be, and, with respect to such books of record a nd account maintained by the Trustee and the Depositary, by an y Credit Provider or any Bondholder or agent or representati ve thereof duly authorized in writing, at reasonable hours and unde r reasonable circumstances. The Government shall provide to any Credit Provider such additional information as may be reas onably requested by such Credit Provider concerning the so urces and amounts of Revenues. COL4/6/20225 GCA GOVERNMENT OPERATIONS CH. 22 GENERAL FISCAL POLICIES AND CONTROLS 159 The Government shall file with the Trustee, the Dep ositary and each Credit Provider, and furnish to each major national investment rating service which initially rated any series of Bonds and to each Bondholder who shall have filed a name and address with the Government or the Trustee for such purpose , within six months after the close of each Fiscal Year so long as any of the Bonds are Outstanding (commencing with the Fiscal Y ear ending in 1 999, complete financial statements with respec t to the Revenues and all funds established pursuant to

l Year so long as any of the Bonds are Outstanding (commencing with the Fiscal Y ear ending in 1 999, complete financial statements with respec t to the Revenues and all funds established pursuant to this Indenture, prepared in accordance with generally accepted acco unting principles for governmental entities, covering rece ipts, disbursements, allocation and application of all Re venues for such Fiscal Year, including a statement of revenues, exp enditures and fund balances (covering all of the funds establishe d pursuant to this Indenture), balance sheet and statement of cha nges in financial position, accompanied by an audit report and opinion of a nationally recognized independent certified publi c accountant. The Government shall also file with the Trustee, th e Depositary and each Credit Provider, and furnish to each major national investment rating service which initially rated any Series of Bonds, within thirty 30 days after receipt of th e annual audited financial statement of the Government prepared by t he Inspector General of the United States Department of Interior or by an Independent certified public accountant, a copy of such statement. § 6.07.

inancial statement of the Government prepared by t he Inspector General of the United States Department of Interior or by an Independent certified public accountant, a copy of such statement. § 6.07. Maintenance of Powers. The Government shall at all times use its best eff orts to maintain the powers, functions, duties and obligati ons now reposed in it pursuant to law, and will not at any time voluntarily do, suffer or permit any act or thing the effect of which would be to hinder, delay or imperil either the payment of t he indebtedness evidenced by any of the Bonds or the observance of any of the covenants herein contained. § 6.08. Continuing Disclosure. The Government and the Trustee hereby covenant and agree that they will comply with and carry out all of the provisions of that certain Continuing Disclosure Agreement betwee n the Government and the Trustee dated the date of issuan ce and COL4/6/20225 GCA GOVERNMENT OPERATIONS CH. 22 GENERAL FISCAL POLICIES AND CONTROLS 160 delivery of the 1997 Series A Bonds, as originally executed and as it may be amended from time to time in accordanc e with the terms thereof (the 'Continuing Disclosure Agreement ').

AND CONTROLS 160 delivery of the 1997 Series A Bonds, as originally executed and as it may be amended from time to time in accordanc e with the terms thereof (the 'Continuing Disclosure Agreement '). Notwithstanding any other provision of this Indentu re, failure of the Government or the Trustee to comply with the Co ntinuing Disclosure Agreement shall not be considered an Eve nt-of Default; however, the Trustee may (and, at the requ est of any Participating Underwriter (as defined in the Contin uing Disclosure Agreement) or the Holders of at least 25 % aggregate principal amount of Outstanding Bonds, shall) or an y Bondholder or Beneficial Owner may take such actions may be ne cessary and appropriate, including seeking mandate or specific performance by court order, to cause the Government or the Trus tee, as the case may be, to comply with its obligations under this S ection. For purposes of this Section, 'Beneficial Owner' means any person which has or shares the power, directly or indirect ly, to make investment decisions concerning ownership of any Bo nds (including persons holding Bonds through nominees, depositories or other intermediaries). § 6.09. Tax Covenants.

rectly or indirect ly, to make investment decisions concerning ownership of any Bo nds (including persons holding Bonds through nominees, depositories or other intermediaries). § 6.09. Tax Covenants. (A) The Government shall not use or permit the use of any proceeds of the 1997 Series A Bonds or any other fu nds of the Government, directly or indirectly, to acquire any securities or obligations, and shall not use or permit the use of any amounts received by the Government in any manner, and shall not take or permit to be taken any other action or actions, whi ch would cause any such Bond to be an 'arbitrage bond' within the meaning of § 148 of the Code, to be 'federally insured or guar anteed' within the meaning of § 149(b) of the Code or to be a 'pri vate activity bond' within the meaning of § 141(a) of the Code. (B) The Government shall at all times do and perfor m all acts and things permitted by law and this Indenture whic h are necessary or desirable in order to assure that inte rest paid on the 1997 Series A Bonds (or on any of them) shall be ex empt from federal income taxes. § 6.10. Compliance with Indenture. Contracts. Laws and Regulations.

e in order to assure that inte rest paid on the 1997 Series A Bonds (or on any of them) shall be ex empt from federal income taxes. § 6.10. Compliance with Indenture. Contracts. Laws and Regulations. COL4/6/20225 GCA GOVERNMENT OPERATIONS CH. 22 GENERAL FISCAL POLICIES AND CONTROLS 161 The Government shall faithfully observe and perfor m all the covenants, conditions and requirements of this Inde nture, shall not issue any Bonds in any manner other than in accorda nce with this Indenture, and shall not take any action that would permit any default to occur hereunder, or do or permit to be d one anything that might in any way weaken, diminish or impair th e security intended to be given pursuant to this indenture. Su bject to the limitations and consistent with the covenants, cond itions and requirements contained in this Indenture, the Gover nment shall comply with the terms, covenants and provisions, ex press or implied, of all contracts concerning or affecting t he application of proceeds of Bonds or Revenues. The Government shall comply promptly, fully and faithfully with and abide by an y statute, law, ordinance, order, rule or regulation, judgment, dec ree, direction or

of proceeds of Bonds or Revenues. The Government shall comply promptly, fully and faithfully with and abide by an y statute, law, ordinance, order, rule or regulation, judgment, dec ree, direction or requirement now in force or hereafter enacted, adop ted, prescribed, imposed or entered by any competent gov ernmental authority or agency applicable to or affecting the Bonds. § 6.11. Collection of Hotel Room Taxes. The Government shall impose, levy, enforce and col lect Hotel Room Taxes (or may, in its sole and absolute discretion, but shall not be obligated to, pay into the Revenue Fun d moneys from any other source) in an aggregate amount within eac h Bond Year at least sufficient to pay and provide for the sum of: (1) an aggregate amount equal to at least one hundr ed twenty-five percent (125%) of Annual Debt Service f or such Bond Year; plus (2) an aggregate amount equal to the amounts requir ed to be deposited in the Rebate Fund during such Bond Year pursuant to § 5.08, plus the amount of Bond Expense s estimated by the Trustee to be payable during such Bond Year; plus (3) such amounts as may be required pursuant to thi s Indenture (and any Supplemental Indenture for the i

e amount of Bond Expense s estimated by the Trustee to be payable during such Bond Year; plus (3) such amounts as may be required pursuant to thi s Indenture (and any Supplemental Indenture for the i ssuance of Bonds of any additional Series) to build up or m aintain the Bond Reserve Fund at the Bond Reserve Fund Requirem ent. The Government further covenants and agrees that al l such Hotel Room Taxes shall be payable in such coin or c urrency of COL4/6/20225 GCA GOVERNMENT OPERATIONS CH. 22 GENERAL FISCAL POLICIES AND CONTROLS 162 the United States of America as at the time of paym ent is legal tender for the payment of public and private debts. § 6.12. Annual Budgets. The Government shall file with the Trustee, the Depositary and each Credit Provider, on or before t he day on which the 1997 Series A Bonds are issued, a budget setting forth the estimated amounts required to be transferred by the Trustee pursuant to subsections _______(c)(1) and (2) of th e Act, separately stated, for the period from such date un til the close of the then current Fiscal Year. On or before the firs t day of each Fiscal Year thereafter, the Government shall file w ith the Trustee, the Depositary and

the period from such date un til the close of the then current Fiscal Year. On or before the firs t day of each Fiscal Year thereafter, the Government shall file w ith the Trustee, the Depositary and each Credit Provider, a budget s etting forth the estimated amounts to be so transferred and other co sts and expenses, separately stated, to be paid from Revenu es for such Fiscal Year. The Government may from time to time a mend any budget filed pursuant to THIS section by filing suc h amendment with the Trustee, the Depositary and each Credit Pr ovider. In the absence of a budget for any Fiscal Year, the Truste e and the Depositary shall assume that the budget for such Fi scal Year is the same as the final budget for the prior Fiscal Year. § 6.13. [Reserved.] § 6.14. Waiver of Laws. The Government shall not at any time insist upon o r plead in any manner whatsoever, or claim or take the benefit or advantage of, any stay or extension law now or at any time he reafter in force that may affect the covenants and agreements contai ned in this Indenture or in the Bonds, and all benefit or advan tage of any such law or laws is hereby expressly waived by the Gover nment to the extent

may affect the covenants and agreements contai ned in this Indenture or in the Bonds, and all benefit or advan tage of any such law or laws is hereby expressly waived by the Gover nment to the extent permitted by law. The Government shall not c laim, and hereby waives any claim to, sovereign immunity from any suit or other action that may be brought under this Indentu re or upon the Bonds. § 6.15. Further Assurances. The Government will make, execute and deliver any and all such further indentures, instruments and assurances as may be reasonably necessary or proper to carry out the int ention or to COL4/6/20225 GCA GOVERNMENT OPERATIONS CH. 22 GENERAL FISCAL POLICIES AND CONTROLS 163 facilitate the performance of this Indenture and fo r the better assuring and confirming unto the Holders of the Bon ds of the rights and benefits provided in this Indenture. ------------ ARTICLE VII EVENTS OF DEFAULT AND REMEDIES OF BONDHOLDERS § 7.01. Events of Default. The following events sha ll be Events of Default: (A) default by the Government in the due and punctu al payment of the principal or Redemption Price of any Bond when and as the same shall become due and payable, wheth er at maturity

nts of Default: (A) default by the Government in the due and punctu al payment of the principal or Redemption Price of any Bond when and as the same shall become due and payable, wheth er at maturity as therein expressed, by proceedings for r edemption, by declaration or otherwise; default by the Government in the redemption from any Mandatory Sinking Account Payme nt of any Term Bonds in the amounts and at the times provided therefor; or default by the Government in the due and punctual p ayment of any installment of interest on any Bond when and as such interest installment shall become due and payable; (B) default by the Government in the observance of any of the covenants, agreements or conditions on its part in this indenture or in the Bonds contained, if such defaul t shall have continued for a period of sixty (60) days after wri tten notice thereof, specifying such default and requiring the same to be remedied, shall have been given to the Government b y the Trustee, or to the Government and the Trustee by an y Credit Provider or by the Holders of not less than twenty- five percent (25%) in aggregate principal amount of the Bonds at the time Outstanding; or (C) the

to the Government and the Trustee by an y Credit Provider or by the Holders of not less than twenty- five percent (25%) in aggregate principal amount of the Bonds at the time Outstanding; or (C) the assumption, under the provisions of any law relating to bankruptcy or insolvency or any similar law rela ting to creditor’s rights, by any court of competent jurisd iction, of custody or control of the Government or of the whol e or any substantial part of its property, if such custody o r control is not terminated or stayed within sixty (60) days from th e daze of assumption of such custody or control. COL4/6/20225 GCA GOVERNMENT OPERATIONS CH. 22 GENERAL FISCAL POLICIES AND CONTROLS 164 § 7.02. Acceleration of Maturities. If an Event of Default shall occur, then, and in e ach and every such case during the continuance of such Event of D efault, the Trustee or the Holders of not less than a majority in aggregate principal amount of the Bonds at the time Outstandi ng shall be entitled, upon notice in writing to the Government, but only upon the written consent of each Credit Provider that is not then in default under its Credit Facility, to declare the p rincipal of all of the Bonds

pon notice in writing to the Government, but only upon the written consent of each Credit Provider that is not then in default under its Credit Facility, to declare the p rincipal of all of the Bonds then Outstanding, and the interest accrue d thereon, to be due and payable immediately, and upon any such d eclaration the same shall become and shall be immediately due and payable, anything in this Indenture or in the Bonds containe d to the contrary notwithstanding. No Credit Provider shall be entitled to give such consent unless it has agreed to pay the B onds payment of which is supported by such Credit Facility, as a ccelerated. Any such declaration, however, is subject to the co ndition that if, at any time after such declaration and bef ore any judgment or decree for the payment of the moneys due shall h ave been obtained or entered, the Government shall deposit w ith the Trustee a sum sufficient to pay all the principal or Redemp tion Price of and installments of interest on the Bonds payment o f which is overdue, with interest on such overdue principal at the rare borne by the respective Bonds, and the reasonable charges and expenses of the Trustee, and any and all other

he Bonds payment o f which is overdue, with interest on such overdue principal at the rare borne by the respective Bonds, and the reasonable charges and expenses of the Trustee, and any and all other Events of Def ault known to the Trustee (other than in the payment of principal of and interest on the Bonds due and payable solely by reason of su ch declaration) shall have been made good or cured to the satisfaction of the Trustee or provision deemed by the Trustee t o be adequate shall have been made therefor, then, and in every s uch case, the Holders of not less than a majority in aggregate pr incipal amount of the Bonds then Outstanding, by written notice to the Government and to the Trustee, may, on behalf of th e Holders of all of the Bonds, rescind and annul such declaratio n and its consequences and waive such default; but no such re scission and annulment shall extend to or shall affect any subse quent default, or shall impair or exhaust any right or power conse quent thereon. § 7.03. Application of Revenues and Other Funds Aft er Default. COL4/6/20225 GCA GOVERNMENT OPERATIONS CH.

any subse quent default, or shall impair or exhaust any right or power conse quent thereon. § 7.03. Application of Revenues and Other Funds Aft er Default. COL4/6/20225 GCA GOVERNMENT OPERATIONS CH. 22 GENERAL FISCAL POLICIES AND CONTROLS 165 If an Event of Default shall occur and be continui ng, all Revenues and any other funds (except the Constructi on Fund and the Rebate Fund) then held or thereafter received b y the Trustee or Depositary under any of the provisions of this I ndenture (subject to § 11.10) shall be under the control of and applied by the Trustee as follows and in the following order: (A) To the payment of any expenses necessary in the opinion of the Trustee to protect the interests of the Holders of the Bonds and payment of reasonable charges and expenses of the Trustee and Depositary (including r easonable fees and disbursements of their respective counsel) incurred in and about the performance of their respective po wers and duties under this Indenture; (B) To the payment of the principal or Redemption P rice of and interest then due on the Bonds (upon present ation of the Bonds to be paid, and stamping thereon of the p ayment if only partially paid, or

To the payment of the principal or Redemption P rice of and interest then due on the Bonds (upon present ation of the Bonds to be paid, and stamping thereon of the p ayment if only partially paid, or surrender thereof if fully paid) subject to the provisions of this Indenture (including § 6. 02), as follows: (1) Unless the principal of all of the Bonds shall have become or have been declared due and payable, First: To the payment to the persons entitled there to of all installments of interest then due in the ord er of the maturity of such installments, and, if the amount available shall not be sufficient to pay in full an y installment or installments maturing on the same da re, then to the payment thereof ratably according to th e amounts due thereon, to the persons entitled theret o, without any discrimination or preference; and Second: To the payment to the persons entitled thereto of the unpaid principal or Redemption Price of any Bond which shall have become due, whether at maturity or by call for redemption, in the order of their due dates, with interest on the overdue principal a t the rate borne by the respective Bonds, and, if the amo unt available shall not be

r at maturity or by call for redemption, in the order of their due dates, with interest on the overdue principal a t the rate borne by the respective Bonds, and, if the amo unt available shall not be sufficient to pay in full al l the Bonds due on any date, together with such interest, then COL4/6/20225 GCA GOVERNMENT OPERATIONS CH. 22 GENERAL FISCAL POLICIES AND CONTROLS 166 to the payment thereof ratably, according to the am ounts of principal or Redemption Price due on such date t o the persons entitled thereto, without any discriminatio n or preference; or (2) If the principal of all of the Bonds shall have become or shall have been declared due and payable, to the payment of the principal and interest then due and unpaid u pon the Bonds, with interest on the overdue principal at th e rate borne by the respective Bonds, and, if the amount availab le shall not be sufficient to pay in full the whole amount s o due and unpaid, then to the payment thereof ratably, withou t preference or priority of principal over interest, or of interest over principal, or of any installment of interest o ver any other installment of interest, or of any Bond over any ot her Bond, according to the

or priority of principal over interest, or of interest over principal, or of any installment of interest o ver any other installment of interest, or of any Bond over any ot her Bond, according to the amounts due respectively for princ ipal and interest, to the persons entitled thereto without a ny discrimination or preference. Notwithstanding the foregoing provisions of this § 7.03, no amounts received pursuant to any Credit Facility sh all be applied for any purpose except to pay amounts due on the Se ries of Bonds with respect to which such Credit Facility was issu ed, unless and except to the extent any Credit Facility specifical ly permits amounts drawn thereunder to be applied to any addit ional purpose. § 7.04. Trustee to Represent Bondholders. The Trustee is hereby appointed (and the successiv e respective Holders of the Bands, by taking and hold ing the same, shall be conclusively deemed to have so appointed t he Trustee) as trustee and true and lawful attorney-in-fact of the Holders of the Bonds for the purpose of exercising and prosecuting on their behalf such rights and remedies as may be available to such Holders under the provisions of the Bonds and this Indenture, as

olders of the Bonds for the purpose of exercising and prosecuting on their behalf such rights and remedies as may be available to such Holders under the provisions of the Bonds and this Indenture, as well as under the Act and applicable provisions of any other law. Upon the occurrence and continuance of an Event of Default or other occasion giving rise to a right in the Truste e to represent the Bondholders, the Trustee in its discretion may, and upon the written request of the Holders of not less than twe nty-five percent (25%) in aggregate principal amount of the Bonds th en Outstanding, and upon being indemnified to its sati sfaction COL4/6/20225 GCA GOVERNMENT OPERATIONS CH. 22 GENERAL FISCAL POLICIES AND CONTROLS 167 therefor, shall, proceed to protect or enforce its rights or the rights of such Holders by such appropriate suit, action, m andamus or other proceedings as it shall deem most effectual t o protect and enforce any such right, at law or in equity, either for the specific performance of any covenant or agreement contained herein, or in aid of the execution of any power herein granted, o r for the enforcement of any other appropriate legal or equit able right or

ecific performance of any covenant or agreement contained herein, or in aid of the execution of any power herein granted, o r for the enforcement of any other appropriate legal or equit able right or remedy vested in the Trustee or in such Holders und er this Indenture, the Act or any other law; and upon insti tuting such proceeding, the Trustee shall be entitled, as a mat ter of right to the appointment of a receiver of the Revenues and other assets pledged under this Indenture, pending such proceedi ngs. All rights of action under this Indenture or the Bonds or othe rwise may be prosecuted and enforced by the Trustee without the possession of any of the Bonds or the production thereof in any p roceeding; relating thereto, and any such suit, action or proc eeding instituted by the Trustee shall be brought in the name of the Trustee for the benefit and protection of all the Holders of such B onds, subject to the provisions of this Indenture. § 7.05. Bondholders Direction of Proceedings. Anything in this Indenture to the contrary notwith standing, the Holders of a majority in aggregate principal am ount of the Bonds then Outstanding shall have the right, by an instrument or

ceedings. Anything in this Indenture to the contrary notwith standing, the Holders of a majority in aggregate principal am ount of the Bonds then Outstanding shall have the right, by an instrument or concurrent instruments in writing executed and deli vered to the Trustee, to direct the method of conducting all rem edial proceedings taken by the Trustee hereunder, provide d that such direction shall not be otherwise than in accordance with law and the provisions of this Indenture, and that the Trus tee shall have the right to decline to follow any such direction which in the opinion of the Trustee would adversely affect Bondholders n ot parties to such direction. § 7.06. Limitation on Bondholders Right to Sue. No Holder of any Bond shall have the right to inst itute any suit, action or proceeding at law or in equity, for the protection or enforcement of any right or remedy under this Inden ture, the Act or any other applicable law with respect to such Bo nd. unless (A) such Holder shall have given to the Trustee written notice of the occurrence of an Event of Default; (B) the Holders of not less than COL4/6/20225 GCA GOVERNMENT OPERATIONS CH.

such Bo nd. unless (A) such Holder shall have given to the Trustee written notice of the occurrence of an Event of Default; (B) the Holders of not less than COL4/6/20225 GCA GOVERNMENT OPERATIONS CH. 22 GENERAL FISCAL POLICIES AND CONTROLS 168 twenty-five percent (25%) in aggregate principal am ount of the Bonds then Outstanding shall have made written requ est upon the Trustee to exercise the powers hereinbefore granted or to institute such suit, action or proceeding in its own name; (C ) such Holder or said Holders shall have tendered to the Trustee reasonable indemnity against the costs, expenses and liabiliti es to be incurred in compliance with such request; and (D) the Truste e shall have refused or omitted to comply with such request for a period of sixty (60) days after such written request shall ha ve been received by, and said tender of indemnity shall have been ma de to, the Trustee. Such notification, request, tender of indemnity and refusal or omission are hereby declared, in every case, to be conditions precedent to the exercise by any Holder of Bonds of any remedy hereunder or under law; it being understood and int ended that no one or more Holders of Bonds shall

ed, in every case, to be conditions precedent to the exercise by any Holder of Bonds of any remedy hereunder or under law; it being understood and int ended that no one or more Holders of Bonds shall have any right i n any manner whatever by its or their action to affect, disturb or prejudice the security of this indenture on the rights of any oth er Holders of Bonds, or to enforce any right under this Indenture , the Act or other applicable law with respect to the Bonds, exc ept in the manner herein provided, and that all proceedings at law or in equity to enforce any such right shall be institute d, had and maintained in the manner herein provided and for th e benefit and protection of all Holders of the Outstanding Bonds, subject to the provisions of this Indenture (including § 6.02). § 7.07. Absolute Obligation of Government. Nothing in § 7.06 or in any other provision of thi s indenture, or in the Bonds, contained shall affect or impair t he obligation of the Government, which is absolute and unconditional , to pay the principal or Redemption Price of and interest on th e Bonds to the respective Holders of the Bonds at their respective dates of maturity, or upon call for

h is absolute and unconditional , to pay the principal or Redemption Price of and interest on th e Bonds to the respective Holders of the Bonds at their respective dates of maturity, or upon call for redemption, as herein pr ovided, but only out of the Revenues and other assets herein pledged therefor, or affect or impair the right of such Holders, which i s also absolute and unconditional, to enforce such payment by virtu e of the contract embodied in the Bonds. § 7.08. Termination of Proceedings. COL4/6/20225 GCA GOVERNMENT OPERATIONS CH. 22 GENERAL FISCAL POLICIES AND CONTROLS 169 In case any proceedings taken by the Trustee or an y one or more Bondholders on account of any Event of Default shall have been discontinued or abandoned for any reason or sh all have been determined adversely to the Trustee or the Bondhold ers, then in every such case the Government, the Trustee and the Bondholders, subject to any determination in such proceedings, s hall be restored to their former positions and rights hereunder, sev erally and respectively, and all rights, remedies, powers and duties of the Government, the Trustee and the Bondholders shall c ontinue as though no such proceedings

sitions and rights hereunder, sev erally and respectively, and all rights, remedies, powers and duties of the Government, the Trustee and the Bondholders shall c ontinue as though no such proceedings had been taken. § 7.09. Remedies Not Exclusive. No remedy herein conferred upon or reserved to the Trustee or to the Holders of the Bonds is intended to be ex clusive of any other remedy or remedies, and each and every such r emedy, to the extent permitted by law, shall be cumulative and in addition to any other remedy given hereunder or now or hereafter ex isting at law or in equity or otherwise. § 7.10. No Waiver of Default. No delay or omission of the Trustee or of any Hold er of the Bonds to exercise any right or power arising upon t he occurrence of any Event of Default shall impair any such right or power or shall be construed to be a waiver of any such defau lt or an acquiescence therein; and every power and remedy gi ven by this Indenture to the Trustee or to the Holders of the B onds may be exercised from time to rime and as often as may be deemed expedient. ---------- ARTICLE VIII THE FIDUCIARIES § 8.01.

edy gi ven by this Indenture to the Trustee or to the Holders of the B onds may be exercised from time to rime and as often as may be deemed expedient. ---------- ARTICLE VIII THE FIDUCIARIES § 8.01. Duties immunities and Liabilities of Truste e, Deposi- tary and Registrar. (A) The Trustee shall, prior to an Event of Defaul t, and after the curing of all Events of Default which may have occurred, perform such duties and only such duties as are spe cifically set COL4/6/20225 GCA GOVERNMENT OPERATIONS CH. 22 GENERAL FISCAL POLICIES AND CONTROLS 170 forth in this Indenture for it to perform. The Trus tee shall, during the existence of any Event of Default which has not been cured, exercise such of the rights and powers vested in it by this Indenture, and use the same degree of care and skil l in their exercise, as a prudent person would exercise or use under the circumstances in the conduct of such person’s own a ffairs. (B) The Depositary and the Registrar shall, prior t o an Event of Default, and after the curing of all Events of D efault which may have occurred, perform such duties and only such du ties as are specifically set forth in this Indenture.

hall, prior t o an Event of Default, and after the curing of all Events of D efault which may have occurred, perform such duties and only such du ties as are specifically set forth in this Indenture. The Depos itary and the Registrar shall, during the existence of any Event of Default (which has not been cured), follow the directions o f the Trustee with respect to any of the funds held by the Deposi tary under this indenture. (C) The Government may remove the Trustee, the Depo sitary or the Registrar at any time unless an Event of Def ault shall have occurred and then be continuing, and shall remove t he Trustee, the Depositary or the Registrar if at any time requeste d to do so by an instrument or concurrent instruments in writing sig ned by the Holders of not less than a majority in aggregate pr incipal amount of the Bonds then Outstanding (or their attorneys d uly authorized in writing) or if at any time the Trustee, the Depo sitary or the Registrar shall cease to be eligible in accordance with subsection (F) of this Section, or shall become incapable of a cting, or shall be adjudged a bankrupt or insolvent, or a receiver of either the Trustee, the Depositary or the Registrar

ccordance with subsection (F) of this Section, or shall become incapable of a cting, or shall be adjudged a bankrupt or insolvent, or a receiver of either the Trustee, the Depositary or the Registrar or their r espective property shall be appointed, or any public officer shall take control or charge of the Trustee, the Depositary or the Reg istrar or their respective property or affairs for the purpose of r ehabilitation, conservation or liquidation; in each case by giving written notice of such removal to the Trustee, the Depositary, and the Registrar and thereupon shall appoint a successor Trustee, De positary or Registrar, as the case may be, by an instrument in writing. (D) The Trustee, the Depositary or the Registrar ma y at any time resign by giving written notice of such resign ation to the Government and the other Fiduciaries. Upon receivin g such notice of resignation, the Government shall promptly appoi nt a successor COL4/6/20225 GCA GOVERNMENT OPERATIONS CH. 22 GENERAL FISCAL POLICIES AND CONTROLS 171 Trustee, Depositary or Registrar, as the case may b e, by an instrument in writing.

romptly appoi nt a successor COL4/6/20225 GCA GOVERNMENT OPERATIONS CH. 22 GENERAL FISCAL POLICIES AND CONTROLS 171 Trustee, Depositary or Registrar, as the case may b e, by an instrument in writing. (E) Any such removal or resignation and appointment of a successor shall become effective upon acceptance of appointment by the successor. Promptly upon such acceptance, th e Government shall give notice thereof to each Paying Agent and Credit Provider and to the Bondholders by mail in t he manner provided by § 4.03. If no successor shall have been appointed and have accepted appointment within forty-five (45) da ys after giving notice of removal or notice of resignation as afore said, the resigning Trustee, Depositary or Registrar, as the case may be, or any Bondholder (on behalf of such Bondholder and al l other Bondholders) may petition any court of competent ju risdiction for the appointment of a successor, and such court may thereupon, after such notice (if any) as it may deem proper, a ppoint such successor. Any such successor appointed under this Indenture shall signify its acceptance of such appointment by executing and delivering to the Government and to its predecessor a

per, a ppoint such successor. Any such successor appointed under this Indenture shall signify its acceptance of such appointment by executing and delivering to the Government and to its predecessor a written acceptance thereof,, and thereupon such successor, without any further act, deed or conveyance, shall become veste d with all the moneys, estates, properties, rights, powers, trusts , duties and obligations of such predecessor, with like effect a s if originally named herein; but, nevertheless, at the Request of the Government or the request of the successor, such predecessor s hall execute and deliver any and all instruments of conveyance or fu rther assurance and do such other things as may reasonably be requi red for more fully and certainly vesting in and confirming to su ch successor all the right, title and interest of such predecessor i n and to any property held by it under this Indenture and shall pay over, transfer, assign and deliver to the successor any m oney or other property subject to the trusts and conditions herei n set forth. Upon request of the successor, the Government shall exec ute and deliver any and all instruments as may be reasonably requir ed for

er property subject to the trusts and conditions herei n set forth. Upon request of the successor, the Government shall exec ute and deliver any and all instruments as may be reasonably requir ed for more fully and certainly vesting in and confirming to su ch successor all such moneys, estates, properties, rights, powers, t rusts, duties and obligations. (F) (1) Any Trustee and any Registrar appointed und er the provisions of this Section in succession to the Tru stee or the Registrar, respectively, shall be a trust company o r commercial COL4/6/20225 GCA GOVERNMENT OPERATIONS CH. 22 GENERAL FISCAL POLICIES AND CONTROLS 172 bank having the powers of a trust company doing bus iness and having a corporate trust office in Guam or in any S tate of The United States, having a combined capital and surplu s of at least Twenty Million Dollars ($20,000,000), and subject t o supervision or examination by federal or state authority. If su ch bank or trust company publishes a report of condition at least an nually, pursuant to law or to the requirements of any super vising or examining authority above referred to, then for the purpose of this Section the combined capital and surplus of such

at least an nually, pursuant to law or to the requirements of any super vising or examining authority above referred to, then for the purpose of this Section the combined capital and surplus of such ba nk or trust company shall be deemed to be its combined capital and surplus as set forth in its most recent report of condition so published. In case at any time the Trustee or the Registrar shall cease to be eligible in accordance with the provisions of this subsection (F)(l), it shah resign immediately in the manner and with t he effect specified in this Section. (2) Any Depositary appointed under the provisions o f this Section in succession to the Depositary shall be a trust company or commercial bank having the powers of a trust com pany doing business and having a trust office in Agana, Guam, having a combined capital and surplus of at least Ten Millio n Dollars ($10,000,000), and subject to supervision or examin ation by federal or Guam authority. If such bank or trust co mpany publishes a report of condition at least annually, pursuant to law or to the requirements of any supervising or examin ing authority above referred to, then for the purpose of this Sec tion the

mpany publishes a report of condition at least annually, pursuant to law or to the requirements of any supervising or examin ing authority above referred to, then for the purpose of this Sec tion the combined capital and surplus of such bank or trust company shall be deemed to be its combined capital and surplus as set forth in its most recent report of condition so published. In ca se at any time the Depositary shall cease to be eligible in accord ance with the provisions of this subsection (F)(2), the Depositar y shall resign immediately in the manner and with the effect speci fied in this Section. (G) Any company into which the Trustee, the Deposit ary or the Registrar may be merged or converted or with wh ich it may be consolidated or any company resulting from any merg er, conversion or consolidation to which it shall be a party or any company to which the Trustee, the Depositary or the Registrar may sell or transfer all or substantially all of it s corporate trust business, provided such company shall be eligible u nder COL4/6/20225 GCA GOVERNMENT OPERATIONS CH. 22 GENERAL FISCAL POLICIES AND CONTROLS 173 subsection (F) of this Section, shall be the succes sor to such

, provided such company shall be eligible u nder COL4/6/20225 GCA GOVERNMENT OPERATIONS CH. 22 GENERAL FISCAL POLICIES AND CONTROLS 173 subsection (F) of this Section, shall be the succes sor to such Trustee, Depositary or Registrar, as the case may b e, without the execution or filing of any paper or any further act , anything herein to the contrary notwithstanding. Any such successor shall give notice of such merger, conversion or consolidation to each other Fiduciary and to the Government. (H) lf the application, payment, withdrawal or tran sfer of money hereunder is not made in accordance with the provisions of this Indenture, the Trustee, Depositary or other responsible Fiduciary shall pay to the Government and shall dep osit into the funds and accounts amounts equal to the expenses in curred and revenues and earnings lost, respectively, as a resu lt of such noncompliance on the part of such Fiduciary. 2018 NOTE: References to 'Territory' and 'territorial' removed and/or altered to 'Guam' pursuant to 1 GCA § 420. § 8.02. Compensation. Subject to the terms of any contract with the Trus tee, Depositary or Registrar, as the case may be, the Go vernment shall pay to the Trustee,

to 'Guam' pursuant to 1 GCA § 420. § 8.02. Compensation. Subject to the terms of any contract with the Trus tee, Depositary or Registrar, as the case may be, the Go vernment shall pay to the Trustee, the Depositary and the Registra r from time to time reasonable compensation for all services rende red under this Indenture, and also all reasonable expenses, charge s, fees of counsel, accountants and consultants and other disb ursements, including those of their attorneys, agents and empl oyees, incurred in good faith in and about the performance of their powers and duties under this Indenture. The Government further agrees, to the extent permitted by law, to indemnify and save the Trustee, the Depositary and the Registrar harmless against any l iabilities which they may incur in the exercise and performanc e of their respective powers, functions and duties under this Indenture, which are not due to their own respective negligenc e or willful misconduct. § 8.03. Liability of Trustee, Depositary and Regist rar. The recitals of facts herein and in the Bonds cont ained shall be taken as statements of the Government, and neith er the Trustee nor the Depositary nor the Registrar assumes

positary and Regist rar. The recitals of facts herein and in the Bonds cont ained shall be taken as statements of the Government, and neith er the Trustee nor the Depositary nor the Registrar assumes any re sponsibility for the correctness of the same, or makes any repre sentations as to the validity or sufficiency of this Indenture, of t he Bonds, or any COL4/6/20225 GCA GOVERNMENT OPERATIONS CH. 22 GENERAL FISCAL POLICIES AND CONTROLS 174 credit facility or pledge and assignment of Revenue s hereon or shall incur any responsibility in respect thereof, other than in connection with the duties or obligations herein or in the Bonds assigned to or imposed upon them, respectively. The Registrar shall, however, be responsible for its representati ons contained in its certificate of authentication and registration on the Bonds. Neither the Trustee nor the Depositary nor the Regi strar shall be liable in connection with the performance of their respective duties hereunder, except for their own respective n egligence or willful misconduct. Any Fiduciary may become the ow ner of the Bonds with the same rights it would have if it were not a Fiduciary, and, to the extent permitted by law,

own respective n egligence or willful misconduct. Any Fiduciary may become the ow ner of the Bonds with the same rights it would have if it were not a Fiduciary, and, to the extent permitted by law, may act as depositary for and permit any of their officers or directors to act as a member of, or in any other capacity with respe ct to, any committee formed to protect the rights of Bondholde rs, whether or not such committee shall represent the Holders o f a majority in principal amount of the Bonds then Outstanding. § 8.04. Right of Fiduciaries to Rely on Documents. Any Fiduciary shall be protected in acting upon an y notice, resolution, request, consent, order, certificate, r equisition, statement, report, opinion, bond or other paper or document believed to be genuine and to have been signed or p resented by the proper party or parties. Any Fiduciary may cons ult with nationally recognized bond counsel, who may be coun sel of or to the Government, with regard to legal questions, and the opinion of such counsel shall be full and complete authoriz ation and protection in respect of any action taken or suffer ed by it hereunder in good faith and in accordance therewith .

tions, and the opinion of such counsel shall be full and complete authoriz ation and protection in respect of any action taken or suffer ed by it hereunder in good faith and in accordance therewith . Whenever in the administration of the trusts impose d upon it by this Indenture a Fiduciary shall deem it necessa ry or desirable that a matter be proved or established prior to tak ing or suffering any action hereunder, such matter (unless other evi dence in respect thereof be herein specifically prescribed) may be deemed to be conclusively proved and established by a Cert ificate of the Government, and such Certificate shall be full warr ant to such Fiduciary for any action taken or suffered in good faith under the provisions of this Indenture in reliance upon such Certificate, but in its discretion such Fiduciary may, in lieu there of, accept other COL4/6/20225 GCA GOVERNMENT OPERATIONS CH. 22 GENERAL FISCAL POLICIES AND CONTROLS 175 evidence of such matter or may require such additio nal evidence as to it may seem reasonable. § 8.05. Preservation and Inspection of Documents. All documents received by any Fiduciary under the provisions of this Indenture shah be retained in it s

io nal evidence as to it may seem reasonable. § 8.05. Preservation and Inspection of Documents. All documents received by any Fiduciary under the provisions of this Indenture shah be retained in it s possession and shall be subject at all reasonable times to the ins pection of the Government and any Bondholder, and their agents and representatives duly authorized in writing, at reas onable hours and under reasonable conditions. § 8.06. Paying Agents. The Government may at any time or from time to tim e appoint one or more Paying Agents, in addition to t he Trustee, for the purpose of paying the principal or Redemption P rice of and the interest on Bonds of any series. Each Paying Ag ent shall signify its acceptance of the duties and obligation s imposed upon it by this Indenture by executing and delivering to the Government and each other Fiduciary a written acceptance there of. The Trustee shall enter into such arrangements with any such Pa ying Agent as shah be necessary and desirable to enable such Payi ng Agent to carry out the duties of its office. The Government may remove any Paying Agent at any time by giving written notice o f such removal to such Paying Agent and each

able to enable such Payi ng Agent to carry out the duties of its office. The Government may remove any Paying Agent at any time by giving written notice o f such removal to such Paying Agent and each other Fiduciary. Any Paying Agent may at any time resign by giving notice of such res ignation to the Government and each other Fiduciary and by giving a ffected Bondholders notice of such resignation by mail in t he manner provided in § 4.03. In the event of the resignation or removal of any Paying Agent, such Paying Agent shah pay over, transfer assign and deliver any monies held by it to its suc cessor or, if there be no successor then appointed, to the Trustee. The Government may appoint one or more successor Paying Agents and shall give prompt notice of the acceptance of appointment by a ny successor Paying Agent. Any Paying Agent appointed under the provisions of this Section shall satisfy the criteria for elig ibility set forth in subsection (F)(1) of § 8.01 with respect to the Tru stee, except that such Paying Agent must have an office in a State of the United States. § 8.07. Notices to Rating Agencies. COL4/6/20225 GCA GOVERNMENT OPERATIONS CH.

§ 8.01 with respect to the Tru stee, except that such Paying Agent must have an office in a State of the United States. § 8.07. Notices to Rating Agencies. COL4/6/20225 GCA GOVERNMENT OPERATIONS CH. 22 GENERAL FISCAL POLICIES AND CONTROLS 176 The Trustee shall give prompt notice to each Ratin g Agency (1) if any Credit Facility terminates or is amended , renewed or replaced, (2) if the Indenture is amended or supple mented, (3) if the Trustee is notified of any amendment to any Cre dit Agreement. (4) if the Trustee is replaced, or (5) i f any of the Bonds are redeemed or defeased. Notwithstanding the foreg oing, it is expressly understood and agreed that failure to pro vide any such notice to any Rating Agency or any defect therein w ill not affect the validity of any action with respect to which no tice is to be given or the effectiveness of any such action. As o f the date hereof, the names and addresses of the Rating Agenc ies rating the 1997 Series A Bonds are as follows: Moody’s Investors Service 99 Church Street New York, New York 10007 Attention: Public Finance Department, Structured Finance Group Standard & Poor’s Corporation 25 Broad Street New York, New York 10004

ody’s Investors Service 99 Church Street New York, New York 10007 Attention: Public Finance Department, Structured Finance Group Standard & Poor’s Corporation 25 Broad Street New York, New York 10004 ---------- ARTICLE IX MODIFICATION OR AMENDMENT OF THE INDENTURE § 9.01. Amendments Permitted. (A) This Indenture and the rights and obligations of the Government and of the Holders of the Bonds and of t he Trustee may be modified or amended at any time by a Supplem ental Indenture which shall become effective when the wri tten consents of each Credit Provider and the Holders of sixty pe rcent (60%) in aggregate principal amount of the Bonds then Outsta nding shall have been filed with the Trustee; provided that (1) if such modification or amendment will, by its terms, not t ake effect so long as any Bonds of any particular maturity or Ser ies remain Outstanding, the consent of the Holders of Bonds of such maturity or Series and the Credit Provider of such Series, i f any, shall not COL4/6/20225 GCA GOVERNMENT OPERATIONS CH. 22 GENERAL FISCAL POLICIES AND CONTROLS 177 be required and such Bonds shall not be deemed to b e Outstanding for the purpose of any calculation of Outstanding B

6/20225 GCA GOVERNMENT OPERATIONS CH. 22 GENERAL FISCAL POLICIES AND CONTROLS 177 be required and such Bonds shall not be deemed to b e Outstanding for the purpose of any calculation of Outstanding B onds under this Section, (2) the consent of the Credit Provider of the 1997 Series A Bonds shall be deemed to be the consent of sixty percent (60%) of the 1.997 Series A Bondholders, and (3) if so pr ovided by the applicable Supplemental Indenture, the consent of t he Credit Provider for a Series of Bonds shall be deemed to b e the consent of the holders of sixty percent in principal amount of the Bonds Outstanding of such Series. No such modification or amendment shall (1) extend the fixed maturity of any Bond, or reduce the amount of principal thereof, or extend the time of payment or reduce the amount of any Mandatory Sinking Account Payment provided herein for the payment of any Bond, or ext end the time of payment of any interest on any Bond, or reduce t he rate of interest thereon, without the consent of the Holder of each Bond so affected, or (2) reduce the aforesaid percentage of Bonds the consent of the Holders of which is required to effe ct any such modification or

hereon, without the consent of the Holder of each Bond so affected, or (2) reduce the aforesaid percentage of Bonds the consent of the Holders of which is required to effe ct any such modification or amendment, or permit the creation o f any lien on the Revenues and other assets pledged under this In denture prior to or on a parity with the lien created by this Ind enture, or deprive the Holders of the Bonds of the lien created by thi s Indenture upon such Revenues and other assets (except as expressly provided in this Indenture), without the consent of the Holders of all of the Bonds then Outstanding. (B) This Indenture and the rights and obligations o f the Government and of the Holders of the Bonds may also be modified or amended at any time by a Supplemental I ndenture, which shah become effective upon execution (or such later date as may be specified in such Supplemental Indenture), w ithout the consent of any Bondholders, but only to the extent permitted by law and only for any one or more of the following p urposes: (1) to add to the covenants and agreements of the Government in this Indenture contained other covena nts and agreements thereafter to be observed, to pledge or

ne or more of the following p urposes: (1) to add to the covenants and agreements of the Government in this Indenture contained other covena nts and agreements thereafter to be observed, to pledge or assign additional security for the Bonds, or to surrender any right or power herein reserved to or conferred upon the Gove rnment, provided, that no such covenant, agreement, pledge, assignment or surrender shall materially adversely affect the interests of the Holders of the Bonds; COL4/6/20225 GCA GOVERNMENT OPERATIONS CH. 22 GENERAL FISCAL POLICIES AND CONTROLS 178 (2) to make such provisions for the purpose of curi ng any ambiguity, inconsistency or omission, or of cur ing or correcting any defective provision, contained in th is Indenture, or in regard to matters or questions ari sing under this Indenture, as the Government may deem necessar y or desirable and not inconsistent with this indenture, and which shall not materially adversely affect the interests of the Holders of the Bonds; (3) to modify, amend or supplement this Indenture i n such manner as to permit the qualification hereof u nder the Trust indenture Act of 1939.

rsely affect the interests of the Holders of the Bonds; (3) to modify, amend or supplement this Indenture i n such manner as to permit the qualification hereof u nder the Trust indenture Act of 1939. as amended, or any sim ilar federal statute hereafter in effect, and to add suc h other terms, conditions and provisions as may be permitted by sa id act or similar federal statute, and which shall not materi ally adversely affect the interests of the Holders of th e Bonds; or (4) to provide for the issuance of an additional Se ries of Bonds, and to provide the terms and conditions unde r which such Bonds may be issued, subject to and in accorda nce with the provisions of Article III. § 9.02. Effect of Supplemental Indenture. From and after the time any Supplemental Indenture becomes effective pursuant to this Article, this Indenture shall be deemed to be modified and amended in accordance therewith, and the respective rights, duties and obligations under thi s Indenture of the Government, the Fiduciaries and all Holders of Bonds Outstanding shall thereafter be determined, exercis ed and enforced hereunder subject in all respects to such modification and amendment, and all the terms

t, the Fiduciaries and all Holders of Bonds Outstanding shall thereafter be determined, exercis ed and enforced hereunder subject in all respects to such modification and amendment, and all the terms and conditions of any such Supplemental Indenture shah be deemed to be part of the terms and conditions of this Indenture for any and all pu rposes. § 9.03. Endorsement of Bonds: Preparation of New Bo nds. Bonds delivered after any Supplemental indenture b ecomes effective pursuant to this Article may, and if the Trustee so determines shall, bear a notation by endorsement or otherwise in a form approved by the Government and the Trustee a s to any modification or amendment provided for in such Supp lemental Indenture, and, in that case, upon demand of the Ho lder of any COL4/6/20225 GCA GOVERNMENT OPERATIONS CH. 22 GENERAL FISCAL POLICIES AND CONTROLS 179 Bond Outstanding at such effective date and present ation of its Bond for the purpose at the Principal Office of the Trustee or at such additional offices as the Trustee may select a nd designate for that purpose, a suitable notation shall be made on such Bond, at the expense of the Government.

ncipal Office of the Trustee or at such additional offices as the Trustee may select a nd designate for that purpose, a suitable notation shall be made on such Bond, at the expense of the Government. If the Government or the Trustee shall so determine, new Bonds so modified as to con form, in the opinion of the Government and the Trustee, to any m odification or amendment contained in such Supplemental Indentu re, shall, at the expense of the Government, be prepared and exec uted by the Government and authenticated by the Registrar, and upon demand of the Holders of any Bonds then Outstanding shah b e exchanged at the Principal Office of the Registrar, without c ost to any Bondholder, for Bonds then Outstanding, upon surren der for cancellation of such Bonds, in equal aggregate prin cipal amounts of the same Series, maturity and tenor. § 9.04. Amendment of Particular Bonds. The provisions of this Article shall not prevent a ny Bondholder from accepting any amendment as to the p articular Bonds held by such Bondholder, provided that due no tation thereof is made on such Bonds. § 9.05. Credit Provider Consent.

t prevent a ny Bondholder from accepting any amendment as to the p articular Bonds held by such Bondholder, provided that due no tation thereof is made on such Bonds. § 9.05. Credit Provider Consent. Nothing in this Article or in this Indenture shall affect any provision of any Credit Agreement requiring the Gov ernment to obtain the consent of the Credit Provider or to sat isfy any other conditions before amending or supplementing this In denture or any Bond. ---------- ARTICLE X DEFEASANCE § 10.01. Discharge of Indenture. If the Government shall pay and discharge the enti re indebtedness on all Bonds Outstanding in any one or more of the following ways: COL4/6/20225 GCA GOVERNMENT OPERATIONS CH. 22 GENERAL FISCAL POLICIES AND CONTROLS 180 (A) by paying or causing to be paid the principal o r Redemption Price of and interest on Bonds Outstandi ng, as and when the same become due and payable; (B) by depositing with the Trustee, in trust, at or before maturity, money or noncallable securities in the ne cessary amount (as provided in § 10.03) to pay or redeem Bo nds Outstanding; or (C) by delivering to the Trustee, for cancellation by it, Bonds Outstanding; and if the Government

securities in the ne cessary amount (as provided in § 10.03) to pay or redeem Bo nds Outstanding; or (C) by delivering to the Trustee, for cancellation by it, Bonds Outstanding; and if the Government shall also pay or cause to be paid all other sums payable hereunder b y the Government, then and in that case, at the election of the Government (evidenced by a Certificate of the Gover nment, filed with the Trustee, signifying the intention of the Government to discharge all such indebtedness and t his Indenture), and notwithstanding that any Bonds shal l not have been surrendered for payment, this Indenture a nd the pledge of Revenues and other assets made under this indenture and ah covenants, agreements and other obligations of the Government under this Indenture shall cease, terminate, become void and be completely dis charged and satisfied. In such event, upon Request of the Government, the Trustee shall cooperate with an acc ounting for such period or periods as shall be requested by the Government to be prepared and filed with the Govern ment and shall execute and deliver to the Government all such instruments as may be necessary or desirable to evi dence such discharge and

d by the Government to be prepared and filed with the Govern ment and shall execute and deliver to the Government all such instruments as may be necessary or desirable to evi dence such discharge and satisfaction, and the Trustee, t he Depositary, the Registrar and any Paying Agents sha h pay over, transfer, assign or deliver to the Government all moneys or securities or other property held by them pursuant to this Indenture which are not required for the pa yment or redemption of Bonds not theretofore surrendered for such payment or redemption; provided that such moneys an d securities shall instead be held by the Trustee for the benefit of the Credit Providers, to be applied as directed by the Government and the Credit Providers or, in the even t of any conflict in such directions, by a court of competen t jurisdiction, if and to the extent that any Credit Provider shah have certified to the Trustee that amounts remain d ue and COL4/6/20225 GCA GOVERNMENT OPERATIONS CH. 22 GENERAL FISCAL POLICIES AND CONTROLS 181 unpaid to such Credit Provider pursuant to its Cred it Agreement. The discharge of the obligations of the Government under this Indenture shall be without pr ejudice to

SCAL POLICIES AND CONTROLS 181 unpaid to such Credit Provider pursuant to its Cred it Agreement. The discharge of the obligations of the Government under this Indenture shall be without pr ejudice to the rights of the Fiduciaries to charge for and be reim- bursed by the Government for any reasonable and cus tomary expenditures which may thereafter be incurred in co nnection herewith. § 10.02. Discharge of Liability on Bonds. Upon the deposit with the Trustee, in trust, at or before maturity, of money or securities in the necessary a mount (as provided in § 10.03) to pay or redeem any Outstandi ng Bond (whether upon or prior to its maturity or the redem ption date of such Bond), then all liability of the Government in respect of such Bond shall cease, determine and be completely disch arged, and the Holder thereof shall thereafter be entitled onl y to payment out of such money or securities deposited with the Trus tee as aforesaid for their payment, subject, however, to t he provisions of § 10.04. The Government may at any time surrender to the Tru stee for cancellation by it any Bonds previously issued and delivered, which the Government may have acquired in any manne r

provisions of § 10.04. The Government may at any time surrender to the Tru stee for cancellation by it any Bonds previously issued and delivered, which the Government may have acquired in any manne r whatsoever, and such Bonds, upon such surrender and cancellation, shall be deemed to be paid and retire d. § 10.03. Deposit of Money or Securities with Truste e. Whenever in this Indenture it is provided or permi tted that there be deposited with or held in trust by the Tru stee money or securities in the necessary amount to pay or redeem any Bonds, the money or securities so to be deposited or held shall be: (a) lawful money of the United States of America in an amount equal to the principal amount of such Bonds and all unpaid interest thereon to maturity, except that, i n the case of Bonds which are to be redeemed prior to maturity, t he amount to be deposited or held shall be the princip al amount or Redemption Price of such Bonds and all unpaid in terest thereon to the date fixed for redemption; or COL4/6/20225 GCA GOVERNMENT OPERATIONS CH. 22 GENERAL FISCAL POLICIES AND CONTROLS 182 (b) noncallable Investment Securities constituting direct obligations of the United States the

or redemption; or COL4/6/20225 GCA GOVERNMENT OPERATIONS CH. 22 GENERAL FISCAL POLICIES AND CONTROLS 182 (b) noncallable Investment Securities constituting direct obligations of the United States the principal of a nd interest on which when due will provide money sufficient to pay the principal or Redemption Price of and all unpaid int erest to maturity, or to the date fixed for redemption, as t he case may be, on the Bonds to be paid or redeemed, as such pr incipal or Redemption Price and interest become due; provided, in each case, that the Trustee shall have been: (i) irrevocably instructed (by the terms of this Indenture and by Request of the Government) to appl y such money to the payment of such principal or Redemption Price and interest with respect to such Bonds, and (ii) provided with confirmation from each Rating Agency that such application of such money will not result in such Rating Agency no longer rating such Bonds. § 10.04. Payment of Bonds after Discharge of Indent ure. Notwithstanding any other provisions of this Inden ture, any moneys held by the Trustee in trust for the payment of the principal or Redemption Price of, or interest on, a ny Bonds and remaining

ure. Notwithstanding any other provisions of this Inden ture, any moneys held by the Trustee in trust for the payment of the principal or Redemption Price of, or interest on, a ny Bonds and remaining unclaimed for two years after the princip al of all of the Bonds has become due and payable (whether at maturi ty or upon call for redemption or by acceleration as provided in this Indenture), if such moneys were so held at such dat e, or two years after the date of deposit of such moneys if deposit ed after said date when all of the Bonds became due and payable, shall , upon Request of the Government, be repaid to the Governm ent free from the mists created by this Indenture, and all l iability of any Fiduciary with respect to such moneys shall thereup on cease and the Holders of such Bonds shall be entitled to look only to Revenues held by the Government for payment of such Bonds; provided, however, that before the repayment of suc h moneys to the Government as aforesaid, the Trustee may (at th e cost of the Government) first publish at least once in a financ ial newspaper or journal circulated in New York, New York, a noti ce, in such form as maybe deemed appropriate by the

stee may (at th e cost of the Government) first publish at least once in a financ ial newspaper or journal circulated in New York, New York, a noti ce, in such form as maybe deemed appropriate by the Trustee, wi th respect to the Bonds so payable and not presented and with res pect to the COL4/6/20225 GCA GOVERNMENT OPERATIONS CH. 22 GENERAL FISCAL POLICIES AND CONTROLS 183 provisions relating to the repayment to the Governm ent of the moneys held for the payment thereof. ---------- ARTICLE XI MISCELLANEOUS § 11.01. Liability of Government Limited to Revenue s. Notwithstanding anything to the contrary in this i ndenture or in the Bands contained, the Government shall not be required to advance any moneys derived from any source other th an the Revenues and other assets pledged under this indent ure for any of the purposes in this Indenture mentioned, whether f or the payment of the principal or Redemption Price of or interest on the Bonds or for any other purpose of this Indenture. Neverth eless, the Government may, but shall not be required to, advan ce for any of the purposes hereof any funds of the Government whi ch may be made available to it for such purposes. § 11.02.

re. Neverth eless, the Government may, but shall not be required to, advan ce for any of the purposes hereof any funds of the Government whi ch may be made available to it for such purposes. § 11.02. Successor is Deemed Included in References to Predecessor. Whenever in this indenture the Government or any F iduciary is named or referred to, such reference shall be de emed to include the successor or assigns thereof, and all the coven ants and agreements in this Indenture contained by or on beh alf of the Government or any Fiduciary shall bind and inure to the benefit of the respective successors and assigns thereof wh ether so expressed or not. § 11.03. Limitation of Rights to Parties and Bondho lders. Nothing in this indenture or in the Bonds expresse d or implied is intended or shall be construed to give t o any person other than the Government, the Fiduciaries, the Cre dit Providers and the Holders of the Bonds any legal or equitable right, remedy or claim under or in respect of this Indenture or a ny covenant., condition or provision therein or herein contained; and all such covenants, conditions and provisions are and shall be held to be COL4/6/20225 GCA GOVERNMENT

pect of this Indenture or a ny covenant., condition or provision therein or herein contained; and all such covenants, conditions and provisions are and shall be held to be COL4/6/20225 GCA GOVERNMENT OPERATIONS CH. 22 GENERAL FISCAL POLICIES AND CONTROLS 184 for the sole and exclusive benefit of the Governmen t, the Fiduciaries, the Credit Providers and the Holders o f the Bonds. § 11.04. Waiver of Notice. Whenever in this Indenture the giving of notice by mail or otherwise is required, the giving of such notice ma y be waived in writing by the person entitled to receive such noti ce and in any such case the giving or receipt of such notice shal l not be a condition precedent to the validity of any action t aken in reliance upon such waiver. § 11.05. Destruction of Bonds. Whenever in this indenture provision is made for t he cancellation by the Trustee or the Registrar and th e delivery to the Government of any Bonds, the Trustee or the Registr ar may, upon Request of the Government, in lieu of such cancella tion and delivery, destroy such Bonds (in the presence of an officer of the Government, if the Government shall so require), an d deliver a certificate of such destruction to

in lieu of such cancella tion and delivery, destroy such Bonds (in the presence of an officer of the Government, if the Government shall so require), an d deliver a certificate of such destruction to the Government. § 11.06. Severability of Invalid Provisions. If any one or more of the provisions contained in this indenture or in the Bonds shall for any reason be h eld to be invalid, illegal or unenforceable in any respect, then such provision or provisions shall be deemed severable from the remai ning provisions contained in this Indenture and such inv alidity, illegality or unenforceability shall not affect any other provision of this Indenture, and this Indenture shall be cons trued as if such invalid or illegal or unenforceable provision had n ever been contained herein. The Government hereby declares th at it would have entered into this Indenture and each and every other Section, paragraph, sentence, clause or phrase hereof and au thorized the issuance of the Bonds pursuant thereto irrespective of the fact that any one or more Sections, paragraphs, sentences, cl auses or phrases of this indenture may be held illegal, inva lid or unenforceable. § 11.07. Notices.

pursuant thereto irrespective of the fact that any one or more Sections, paragraphs, sentences, cl auses or phrases of this indenture may be held illegal, inva lid or unenforceable. § 11.07. Notices. Any notice to or demand upon the Government, the T rustee, the Depositary or the Registrar shall be deemed to have been COL4/6/20225 GCA GOVERNMENT OPERATIONS CH. 22 GENERAL FISCAL POLICIES AND CONTROLS 185 sufficiently given or served for all purposes by be ing deposited, postage prepaid, in a post office letter box, addre ssed to the applicable address set forth below, or at such othe r address as may have been filed in writing by such party with each other party. At the date of execution of this Indenture, the addres s of the Government and the Principal Office of each Fiducia ry are as follows: Government: Department of [Revenue and Taxation] Agana, Guam 96910 Attention.: Director Trustee: Depositary: Registrar: Any notice to or demand upon any Credit Provider sh all be given or made in the manner and at the Principal Of fice of such Credit Provider designated in or pursuant to its re spective Credit Facility or Credit Agreement. § 11.08. Evidence of Rights of Bondholders.

r made in the manner and at the Principal Of fice of such Credit Provider designated in or pursuant to its re spective Credit Facility or Credit Agreement. § 11.08. Evidence of Rights of Bondholders. Any request, consent or other instrument required or permitted by this Indenture to be signed and execut ed by Bondholders may be in any number of concurrent inst ruments of substantially similar tenor and shall be signed or executed by such Bondholders in person or by an agent or agents duly appointed in writing. Proof of the execution of any such request , consent or other instrument or of a writing appointing any suc h agent shall be sufficient for any purpose of this Indenture and shall be conclusive in favor of the Trustee, the Depositary, the Registrar and the Government if made in the manner provided i n this Section. The fact and date of the execution by any person of any such request, consent or other instrument or writing may be proved by the certificate of any notary public or other offic er of any jurisdiction, authorized by the laws thereof to tak e acknowledgments of deeds, certifying that the perso n signing such request, consent or other instrument acknowledged t o him

ther offic er of any jurisdiction, authorized by the laws thereof to tak e acknowledgments of deeds, certifying that the perso n signing such request, consent or other instrument acknowledged t o him the COL4/6/20225 GCA GOVERNMENT OPERATIONS CH. 22 GENERAL FISCAL POLICIES AND CONTROLS 186 execution thereof, or by an affidavit of a witness of such execution duly sworn to before such notary public or other of ficer. The ownership of Bonds shall be proved by the bond registration books held by the Registrar. Any request, consent, or other instrument or writin g of the Holder of any Bond shall bind every future Holder o f the same Bond and the Holder of every Bond issued in exchang e therefor or in lieu thereof, in respect of anything done or suffered to be done by the Trustee, the Depositary, the Registrar or the Government in accordance therewith or reliance ther eon. § 11.09. Disqualified Bonds. In determining whether the Holders of the requisit e aggregate principal amount of Bonds have concurred in any dem and, request, direction, consent or waiver under this In denture, Bonds which are owned or held by or for the account of th e Government, or by any other obligor on the Bands,

ve concurred in any dem and, request, direction, consent or waiver under this In denture, Bonds which are owned or held by or for the account of th e Government, or by any other obligor on the Bands, including any Credit Provider, or by any person directly or indirectly c ontrolling or controlled by, or under direct or indirect common c ontrol with, the Government or any other obligor on the Bonds, shall be disregarded and deemed not to be Outstanding for th e purpose of any such determination. Bonds so owned which have b een pledged in good faith may be regarded as Outstandin g for the purposes of this Section if the pledgee shall estab lish to the satisfaction of the Trustee the pledgee’s right to vote such Bonds and that the pledgee is not a person directly or in directly controlling or controlled by, or under direct or in direct common control with, the Government or any other obligor o n the Bonds. In case of a dispute as to such right, any decision by the Trustee taken upon the advice of counsel shall be full prot ection to the Trustee. § 11.10. Money Held for Particular Bonds. The money held by the Trustee for the payment of t he interest, principal or Redemption Price due

advice of counsel shall be full prot ection to the Trustee. § 11.10. Money Held for Particular Bonds. The money held by the Trustee for the payment of t he interest, principal or Redemption Price due on any date with respect to particular Bonds (or portions of Bonds i n the case of registered Bonds redeemed in part only) shall, on a nd after such date and pending such payment, be set aside on its books and held COL4/6/20225 GCA GOVERNMENT OPERATIONS CH. 22 GENERAL FISCAL POLICIES AND CONTROLS 187 in trust by it for the Holders of the Bonds entitle d thereto, subject, however, to the provisions of § 10.04. § 11.11. Funds and Accounts. Any fund required by this Indenture to be establis hed and maintained by the Trustee or Depositary may be esta blished and maintained in the accounting records of the Trustee or Depositary, either as a fund or an account, and may, for the pu rposes of such records, any audits thereof and any reports or stat ements with respect thereto, be treated either as a fund or as an account; but all such records with respect to all such funds shall a t all times be maintained in accordance with generally accepted ac counting principles, to the extent

ed either as a fund or as an account; but all such records with respect to all such funds shall a t all times be maintained in accordance with generally accepted ac counting principles, to the extent practicable, and with due regard for the requirements of §§ 5.08 and 6.09, as established by Request of the Government and for the protection of the security o f the Bonds and the rights of every holder thereof. § 11.12. Article and Section Headings and Reference s. The headings or titles of the several Articles and Sections hereof, and any table of contents appended to copie s hereof, shall be solely for convenience of reference and shall no t affect the meaning, construction or effect of this Indenture. All references herein to 'Articles,' 'Sections' and other subdivisions are to the corresponding Articles, Sec tions or subdivisions of this Indenture; the words 'herein,' 'hereof,' 'hereby,' 'hereunder' and other words of similar im port refer to this Indenture as a whole and not to any particular Article, Section or subdivision hereof; and words of any gender shal l mean and include words of the other genders. § 11.13. Waiver of Personal Liability.

denture as a whole and not to any particular Article, Section or subdivision hereof; and words of any gender shal l mean and include words of the other genders. § 11.13. Waiver of Personal Liability. No legislator, officer, agent or employee of the G overnment shall be individually or personally liable for the payment of the principal or Redemption Price of or interest on the Bonds; but nothing herein contained shall relieve any such leg islator, officer, agent or employee from the performance of any offic ial duty provided by law. § 11.14. Saturdays. Sundays and Legal Holidays. COL4/6/20225 GCA GOVERNMENT OPERATIONS CH. 22 GENERAL FISCAL POLICIES AND CONTROLS 188 If any party hereto is required to perform, pursua nt to a provision of this Indenture, any act on a date whic h falls on a Saturday, Sunday or legal holiday, the party requir ed to perform such act shall be deemed to have performed it in a timely manner, and in conformance with such provision, if it shall perform such act on the next succeeding Business Day. § 11.15. Execution in Several Counterparts. This Indenture may be executed in any number of counterparts and each of such counterparts shall fo r all purposes be

on the next succeeding Business Day. § 11.15. Execution in Several Counterparts. This Indenture may be executed in any number of counterparts and each of such counterparts shall fo r all purposes be deemed to be an original; and all such counterpa rts, or as many of them as the Government, the Trustee, the Deposit ary and the Registrar shall preserve undestroyed, shall togethe r constitute but one and the same instrument. § 11.16. Governing Law. The rights and duties of the parties to this Inden ture shall be governed by the laws of Guam, provided, however, th at the administration of the trusts imposed upon the Trust ee by the Indenture and the rights and duties of the Trustee hereunder shall be governed by, and construed in accordance with th e laws of the jurisdiction in which the Trustee has its Principal Office. IN WITNESS WHEREOF, the GOVERNMENT OF GUAM has caused this Indenture to be signed in its name by its duly authorized officers under its seal; and [TRUSTEE], in token of its acceptance of the trusts created hereunder, has cau sed this indenture to be signed on its corporate name by one of its authorized officers and its corporate seal to be he reunto affixed, all as

its acceptance of the trusts created hereunder, has cau sed this indenture to be signed on its corporate name by one of its authorized officers and its corporate seal to be he reunto affixed, all as of the day and year first above written. GOVERNMENT of GUAM By _____________________ Governor [SEAL] By _____________________ Director of Administration COL4/6/20225 GCA GOVERNMENT OPERATIONS CH. 22 GENERAL FISCAL POLICIES AND CONTROLS 189 [TRUSTEE], as Trustee [CORPORATE SEAL] By _____________________ Title: The undersigned, [DEPOSITARY], hereby accepts and agrees to perform the duties and obligations of Dep ositary under this Indenture. [DEPOSITARY] By ______________________ Title: [CORPORATE SEAL] The undersigned, [REGISTRAR], hereby accepts and ag rees to perform the duties and obligations of Registrar under this Indenture. [REGISTRAR], as Registrar By ______________________ Title: [CORPORATE SEAL] COL4/6/20225 GCA GOVERNMENT OPERATIONS CH. 22 GENERAL FISCAL POLICIES AND CONTROLS 190 EXHIBIT A [FORM OF BOND] No. _____ $ _______ GOVERNMENT OF GUAM LIMITED OBLIGATION INFRASTRUCTURE IMPROVEMENT BOND 1997 SERIES A INTEREST RATE DATED DATE MATURITY DATE CUSIP Registered Holder

OLS 190 EXHIBIT A [FORM OF BOND] No. _____ $ _______ GOVERNMENT OF GUAM LIMITED OBLIGATION INFRASTRUCTURE IMPROVEMENT BOND 1997 SERIES A INTEREST RATE DATED DATE MATURITY DATE CUSIP Registered Holder Principal Sum: Dollars The GOVERNMENT OF GUAM, duly organized and existing under and by virtue of the laws of the Uni ted States of America (herein called the ‘Government’), for value received, hereby promises to pay (but only out of the Revenue s and other assets pledged therefor as hereinafter mentioned) t o the registered holder identified above or registered assigns, on t he maturity date specified above (subject to any right of prior rede mption hereinafter mentioned), the principal sum specified above in lawful money of the United States of America; and t o pay interest thereon, in like lawful money and solely from said Revenues and assets, from the interest payment date next precedi ng the date of registration of this Band (unless this Bond is regi stered as of a day during the period from the fourteenth day next prec eding any interest payment date to such interest payment date , inclusive, in which event it shall bear interest from such intere st payment date, or unless this

iod from the fourteenth day next prec eding any interest payment date to such interest payment date , inclusive, in which event it shall bear interest from such intere st payment date, or unless this Bond is registered on or before_____ __, in which event it shall bear interest from ________) until p ayment of such principal sum shall be discharged as provided in th e indenture hereinafter mentioned, at the interest rate specifi ed above per annum, payable semiannually on __________ and _____ ______ COL4/6/20225 GCA GOVERNMENT OPERATIONS CH. 22 GENERAL FISCAL POLICIES AND CONTROLS 191 in each year, commencing ___________, 1990. The pri ncipal (or redemption price) hereof is payable upon surrender hereof at the principal corporate trust office of [Trustee] (here in called the ‘Trustee’) in _____, ________, and the interest her eon is payable by check or draft mailed to the person in whose nam e this Bond or any predecessor Band is registered at the close of business on the fifteenth day immediately preceding an interest payment date, at such person’s address as it appears on the bond registration books of the Registrar.

and is registered at the close of business on the fifteenth day immediately preceding an interest payment date, at such person’s address as it appears on the bond registration books of the Registrar. The Bonds are limited obligations of the Government and are not a lien or charge upon the funds or property of the Government, except to the extent of the pledge and assignment h ereinafter described. Neither the faith and credit of the Gove rnment nor the faith and credit of the United States of America or any political subdivision thereof is pledged to the payment of th e principal of or interest on the Bonds. This Bond is one of a duly authorized issue of bond s of the Government designated as the ‘Government of Guam Li mited Obligation Infrastructure Improvement Bonds’ (herei n called the ‘Bonds’), unlimited in aggregate principal amount, except as otherwise provided in the laws of the United States of America and the Government of Guam and in the Indenture hereina fter mentioned, which issue of Bonds consists or may con sist of one or more series of varying dates, maturities, interest rates, and redemption and other provisions, all issued or to b e issued pursuant to Section ____

h issue of Bonds consists or may con sist of one or more series of varying dates, maturities, interest rates, and redemption and other provisions, all issued or to b e issued pursuant to Section ____ of Tide 5 of the Guam Code Annotate d, as amended, and that certain Indenture, dated as of _________, 1997, by and between the Government and the Trustee (herein call ed the Indentures). This Bond is also one of a duly author ized series of Bonds additionally designated '______ Series ______ _' (herein called the '_____ Series ____ Bonds'), in the aggre gate principal amount of _________________________________ Dollars ($_____________), all issued under the provisions o f the Indenture. The Bonds are issued for the purpose of providing m oneys for the implementation of certain capital improvement proje cts. Reference is hereby made to the Indenture (a copy of which is on file at said office of the Trustee) and all indentures supplemen tal thereto for a description of the rights thereunder of the registe red owners of the Bonds, of the nature and extent of the security and provisions for COL4/6/20225 GCA GOVERNMENT OPERATIONS CH.

n tal thereto for a description of the rights thereunder of the registe red owners of the Bonds, of the nature and extent of the security and provisions for COL4/6/20225 GCA GOVERNMENT OPERATIONS CH. 22 GENERAL FISCAL POLICIES AND CONTROLS 192 payment of the Bonds, of the rights, duties and imm unities of the Trustee and other fiduciaries and of the rights and obligations of the Government thereunder, to all the provisions of whi ch Indenture the registered owner of this Bond, by acceptance hereof , assents and agrees. The Bonds and the interest thereon (to the extent s et forth in the Indenture) are payable from Revenues (as that t erm is defined in the Indenture) and other assets pledged as provided in the Indenture, and are secured by a pledge of said Revenues (excep t to the extent of the Rebate Requirement referred to in the Indent ure), the proceeds of the sale of the Bands and amounts held in the funds and accounts established pursuant to the Indenture, sub ject only to provisions of the Indenture permitting the applicat ion thereof for or to the purposes and on the terms and conditions set forth in the Indenture.

ablished pursuant to the Indenture, sub ject only to provisions of the Indenture permitting the applicat ion thereof for or to the purposes and on the terms and conditions set forth in the Indenture. The ________ Series ________ Bonds maturing after______, ______ are subject to redemption prior to their respective stared maturities, at the option of the Government, from any source of available funds, on any date on or af ter _________, __________, as a whole, or in part by such maturity or maturities as may be specified by the Government (and by lot w ithin a maturity), at the Redemption Prices (expressed as p ercentages of principal amount) set forth in the table below plus interest accrued thereon to the date fixed for redemption: Redemption Dates Redemption Prices ______, _______ to and including ______, _______ __ _____ % ______, _______ to and including ______, _______ __ _____ % ______, _______ to and including ______, _______ _______ % ______, _______ to and including ______, _______ __ _____ % _______, _______ and thereafter 100 % The _____Series _____ Bonds maturing on _________, and the Series Bonds maturing on ________, respectively , are also subject to redemption

_, _______ __ _____ % _______, _______ and thereafter 100 % The _____Series _____ Bonds maturing on _________, and the Series Bonds maturing on ________, respectively , are also subject to redemption prior to their stated maturit ies, in part in lots of $5,000 principal, from Mandatory Sinking Account Payments COL4/6/20225 GCA GOVERNMENT OPERATIONS CH. 22 GENERAL FISCAL POLICIES AND CONTROLS 193 established for each such maturity as provided in t he Indenture, on any _________ on or after _________, or ________ _, respectively, at the principal amount thereof plus interest accrued thereon to the date fixed for redemption, without p remium. Notice of any redemption, identifying the Bonds or portions thereof to be redeemed, shall be given by the Trust ee not less than 30 nor more than 60 days before the date fixed for redemption by mail to each of the registered owners of Bonds desi gnated for redemption at their addresses appearing on the bond registration books of the Registrar on the date the Bonds to be redeemed are selected. Receipt of such notice by such registered owners shall not be a condition precedent to such redemption.

the bond registration books of the Registrar on the date the Bonds to be redeemed are selected. Receipt of such notice by such registered owners shall not be a condition precedent to such redemption. If this Bond is called for redemption and payment i s duly provided Hereford as specified in the Indenture, in terest shall cease to accrue hereon from and after the date fixe d for redemption. If an Event of Default (as that term is defined in the Indenture) shall occur, the principal of all Bonds (and the interest accrued thereon) may be declared due and payable up on the conditions, in the manner and with the effect provi ded in the Indenture. The Indenture provides that in certain e vents such a declaration and its consequences may be rescinded b y the registered owners of not less than a majority in ag gregate principal amount of the Bonds then outstanding. The _______ Series ____ Bonds are issuable only in fully registered form in denominations of $5,000 or any i ntegral multiple thereof. Subject to the limitations and up on payment of the charges, if any, provided in the Indenture, thi s Bond may be exchanged, at the office of [Registrar], as Registr ar, in _____ _____, for a

hereof. Subject to the limitations and up on payment of the charges, if any, provided in the Indenture, thi s Bond may be exchanged, at the office of [Registrar], as Registr ar, in _____ _____, for a new fully registered Bond or Bonds, of the same series, maturity and tenor and of any authorized de nomination or denominations and for the aggregate principal amoun t of this Band then remaining outstanding. This Bond is transferable by the registered owner h ereof, in person or by its attorney duly authorized in writin g, at said office of the Registrar, but only in the manner, subject t o the limitations and upon payment of the charges, if any, provided i n the COL4/6/20225 GCA GOVERNMENT OPERATIONS CH. 22 GENERAL FISCAL POLICIES AND CONTROLS 194 Indenture, and upon surrender and cancellation of t his Bond. Upon such transfer a new registered Bond or Bonds, of th e same series, maturity and tenor and of any authorized denominati on or denominations and for the same aggregate principal amount of this Bond then remaining outstanding, will be issued to the transferee in exchange Hereford.

tenor and of any authorized denominati on or denominations and for the same aggregate principal amount of this Bond then remaining outstanding, will be issued to the transferee in exchange Hereford. The Registrar shall not be re quired to register the transfer of this Bond during the five days next preceding any date established by the Trustee for t he selection of Bonds for redemption or at any time after selection of this Bond for redemption. The Government, the Trustee and the may treat the r egistered owner hereof as the absolute owner hereof for all p urposes, and neither the Government, the Trustee nor the Registr ar shall be affected by any notice to the contrary. The Indenture and the rights and obligations of the Government, the registered owners of the Bonds, the Trustee, the Registrar and other fiduciaries may be modified or amended at any time in the manner, to the extent, and upon the ter ms provided in the Indenture, provided that no such modification o r amendment shall (i) extend the fixed maturity of this Bond, o r reduce the amount of principal hereof, or extend the time of p ayment or reduce the amount of any Mandatory Sinking Account Payment provided in the

all (i) extend the fixed maturity of this Bond, o r reduce the amount of principal hereof, or extend the time of p ayment or reduce the amount of any Mandatory Sinking Account Payment provided in the Indenture for the payment of this B and, or extend the time of payment of any interest on this Band or reduce the rate of interest hereon, without the consent of the regi stered owner hereof, or (ii) reduce the percentage of the princi pal amount of Bonds the consent of the registered owners of which is required to effect any such modification or amendment, permit t he creation of any lien on the Revenues and other assets pledged a s security for the Bonds (including additional Bands hereafter iss ued) prior to or on a parity with the lien created by the Indentu re or deprive the registered owners of the Bands of the lien of the I ndenture (except as expressly provided in the indenture), without th e consent of the registered owners of all Bonds then outstanding, al l as more fully set forth in the Indenture. This Bond shall not be entitled to any benefit unde r the Indenture, or become valid or obligatory for any pu rpose, until the COL4/6/20225 GCA GOVERNMENT OPERATIONS CH.

y set forth in the Indenture. This Bond shall not be entitled to any benefit unde r the Indenture, or become valid or obligatory for any pu rpose, until the COL4/6/20225 GCA GOVERNMENT OPERATIONS CH. 22 GENERAL FISCAL POLICIES AND CONTROLS 195 certificate of authentication and registration here on endorsed shall have been dated and signed by the Registrar. It is hereby certified and recited that any and all conditions, things and acts required to exist, to have happened and to have been performed precedent to and in the issuance of this Bond exist, have happened and have been performed in due time, form and manner as required by the laws of the United St ates of America and the Government of Guam, and that the am ount of this Bond, together with all other indebtedness of the Government, does not exceed any limit prescribed by such laws, and is not in excess of the amount of Bands permitted to be issue d under the Indenture. IN WITNESS WHEREOF, The GOVERNMENT OF GUAM has caused this Bond to be executed in its nam e and on its behalf by the facsimile signature of the Governor o f Guam and the Director of Administration of the Government of Gua m and its seal to be reproduced hereon

nd to be executed in its nam e and on its behalf by the facsimile signature of the Governor o f Guam and the Director of Administration of the Government of Gua m and its seal to be reproduced hereon by facsimile, all as o f the Dated Daze specified above. GOVERNMENT OF GUAM By ______________________ Governor (SEAL) By ______________________ Director of Administration COL4/6/20225 GCA GOVERNMENT OPERATIONS CH. 22 GENERAL FISCAL POLICIES AND CONTROLS 196 [FORM OF] REGISTRAR’S CERTIFICATE OF AUTHENTICATION AND REGISTRATION This is one of the Bonds described in the within me ntioned Indenture, which has been registered as of ________ ______ [REGISTRAR], as Registrar By ______________________ Authorized Officer COL4/6/20225 GCA GOVERNMENT OPERATIONS CH. 22 GENERAL FISCAL POLICIES AND CONTROLS 197 [STATEMENT OF INSURANCE] [FORM OF] ASSIGNMENT The following abbreviations, when used in the inscr iption on the face of the within Band and in the assignment b elow, shall be construed as though they were written out in full a ccording to applicable laws or regulations. TEN COM - as tenants in common TEN ENT - as tenants by the entireties JT TEN - as joint tenants with right of survivorshi p

they were written out in full a ccording to applicable laws or regulations. TEN COM - as tenants in common TEN ENT - as tenants by the entireties JT TEN - as joint tenants with right of survivorshi p and not as tenants in common UNIF GIFT MIN ACT -__ Custodian___ (Cut) (Minor) under Uniform Gifts to Minors Act _________________ __ (State) Additional abbreviations may also be used though no t in the above list. For value received the undersigned do(es) hereby se ll, assign and transfer unto __________ the within-mentioned r egistered Bond and hereby irrevocably constitute(s) and appoi nt(s) attorney, to transfer the same on the books of the Registrar with ft power of substitution in the premises. Dated: ______ ___________________________ NOTICE: The signature on this Assignment must correspond with the name as it appears on the face of the within Bond in every particular, without alteration or enlargement or any change whatsoever. Signature Guaranteed: Social Security Number, Taxpa yer Identification Number or other Identifying Number of Assignment COL4/6/20225 GCA GOVERNMENT OPERATIONS CH.

nlargement or any change whatsoever. Signature Guaranteed: Social Security Number, Taxpa yer Identification Number or other Identifying Number of Assignment COL4/6/20225 GCA GOVERNMENT OPERATIONS CH. 22 GENERAL FISCAL POLICIES AND CONTROLS 198 ____________________ ________________________ Notice: Signature must be guaranteed by a member firm of the New York Stock Exchange or a commercial bank or trust company. Note : Transfer fees must be paid to the Registrar in or der to transfer or exchange this bond as provided in the within-mentioned Indenture. COL4/6/20225 GCA GOVERNMENT OPERATIONS CH. 22 GENERAL FISCAL POLICIES AND CONTROLS 199 Exhibit B COL4/6/20225 GCA GOVERNMENT OPERATIONS CH. 22 GENERAL FISCAL POLICIES AND CONTROLS 200 Sheet 1 Exhibit B Projects Project Amount Tumon Fafai Reversion Project 1. For the relocation of force main sewage or distribution and transmission water lines that are encroaching on private property along Happy Landing Road. $1,1 00,000 2. For the design and construction of the Tumon Pump Station and Force main $3,600,000 3. For the refurbishment of the Northern District Sewage Treatment Plant $1,800,000 4.

Landing Road. $1,1 00,000 2. For the design and construction of the Tumon Pump Station and Force main $3,600,000 3. For the refurbishment of the Northern District Sewage Treatment Plant $1,800,000 4. For the refurbishment of the Agana Sewage Treatment Plant $2,000,000 Oka Point Collector System Project 5. For the design and construction of the Oka Point collector lines $2,000,000 Tumon Water Lines 6. For design and construction of waterlines $4,2 00,000 Tumon Water Sources 7. For drilling and construction and a study to evaluate the northern water system. $5,800 ,000 Tumon Bay Beautification 8. Streets & Sidewalks for medians, crosswalks & intersections, beach access, sidewalks & curbs, Street furniture for benches, trash containers, signage, shelters, street lights & traffic lighting, enhancements for Gov. Flores and Matapang Beach Parks. $7,200,000 9. Landscaping for medians, road edge strips, & entry points from San Vitores Blvd. to beach access. $3,900,000 COL4/6/20225 GCA GOVERNMENT OPERATIONS CH. 22 GENERAL FISCAL POLICIES AND CONTROLS 201 10. Services undergrounding for ocean side power lines & cables, clutter, removal of guy wires, & signage consolidations $4,500,000 11.

MENT OPERATIONS CH. 22 GENERAL FISCAL POLICIES AND CONTROLS 201 10. Services undergrounding for ocean side power lines & cables, clutter, removal of guy wires, & signage consolidations $4,500,000 11. Design & management fees for design development, construction documentation, permitting, & construction management $1,600,000 12. Allowances for roadway repairs & restoration resurfacing of San Vitores Blvd. off-site infrastructure work directly related to the Tumon area infrastructure. $5,000,000 13. Construction of the San Vitores Substation & transmission lines by the Guam Power Authority in the Tumon Bay area Total $5,900,000 14. Funds to cover shortfalls in Items (1) through (13) ($4,000,000). Any sum that is surplus from any of the projects, and any additional funds generated from the interest of this funding source, shall also be used to cover shortfalls in Items (1) through (13). 15. Study by the University of Guam’s Water and Environmental Research Institute on the environmental effects of changes to Southern Tumon Bay’s drainage system. Construction on Phase II shall begin upon DPW’s receipt of the Study’s preliminary report, or February 28, 2002, whichever is sooner.

ental effects of changes to Southern Tumon Bay’s drainage system. Construction on Phase II shall begin upon DPW’s receipt of the Study’s preliminary report, or February 28, 2002, whichever is sooner. $ 300,000 16. To the extent that any of the bond proceeds are not required for the projects listed in Items (1) through (13) of Exhibit B, the Department of Public Works may transfer funds between projects, even if projects are not complete, as long as the following conditions are met: COL4/6/20225 GCA GOVERNMENT OPERATIONS CH. 22 GENERAL FISCAL POLICIES AND CONTROLS 202 a. in the case of funds allocated for Guam Waterworks Authority infrastructure projects, the department receives concurrence from the Guam Waterworks Authority within sixty (60) days from notification from DPW of the proposed transfer; the fund transfer shall be deemed approved by GWA if GWA fails to disapprove of the transfer within the sixty (60) day period; and b. utility upgrades, including creation of underground power systems and improvements to drainage, water and sewage systems, are to be given priority at all times over beautification projects; and c.

b. utility upgrades, including creation of underground power systems and improvements to drainage, water and sewage systems, are to be given priority at all times over beautification projects; and c. the department notifies I Liheslaturan Guåhan [Guam Legislature] of the proposed transfers prior to any actual transfer of funds. Such transfers are considered approved, unless a formal objection to the transfer is made by the Speaker within ten (10) working days of the notification. 17. The sum not to exceed Four Million Two Hundred Thousand Dollars ($4,200,000.00) of the unused balance for roadway repairs and resurfacing of Pale San Vitores Road, and for upgrades and repairs to the Tumon Area infrastructure. Total $52,900,000 SOURCE : Items 4, 7 and 12 amended by P.L. 26-064:3,4 & 5 . Items 14- 16 added by P.L. 26-065:6-8. Item 17 added by P.L. 28-027:1, amended by P.L. 29-113:VI:52 (Sept. 30, 2008). NOTE : The Legislature did not change the overall total when it amended this Exhibit B in P.L. 26-065, P.L. 28-071, and P. L. 29-113. If a new total is warranted, the Compiler believes it should be us ed rather than the former total as the Legislature clearly meant to apply the changes

in P.L. 26-065, P.L. 28-071, and P. L. 29-113. If a new total is warranted, the Compiler believes it should be us ed rather than the former total as the Legislature clearly meant to apply the changes made. 2012 NOTE: In maintaining the general codification scheme of t he GCA the Compiler changed the hierarchy of subsections b eginning with 'Numbers' to 'Lowercase Letters' and subsections be ginning with COL4/6/20225 GCA GOVERNMENT OPERATIONS CH. 22 GENERAL FISCAL POLICIES AND CONTROLS 203 'Lowercase Letters' to 'Numbers' in this exhibit. ---------- ARTICLE 11 HEALTH AND HUMAN SERVICES FUND NOTE: This Article was renumbered from Chapter 24 of this Title 5. This Article was added by P.L. 24-174:2 as Artic le 10 of Chapter 22 of this Title 5. § 221101. Creation. § 221102. Separate Fund and Bank Account § 221103. Purpose and Expenditures. § 221104. Administration. § 221105. Designation of single Agency; Promulgatio n of Rules and Regulations. § 221106. Staffing, Funding, Initial Set Up. § 221107. Appropriation and Exemption. § 221108. Deposit. § 221109. Interest. § 221101. Creation. There is hereby created, separate and apart from t he other funds of the government of Guam, a fund

. § 221107. Appropriation and Exemption. § 221108. Deposit. § 221109. Interest. § 221101. Creation. There is hereby created, separate and apart from t he other funds of the government of Guam, a fund known as th e 'Health And Human Services Fund' (‘HAHS Fund’). § 221102. Separate Fund and Bank Account. The HAHS Fund shall not be commingled with the Gen eral Fund and shall be kept in a separate bank account. The Governor, pursuant to any of his transfer authority, shall tr ansfer no monies from the HAHS Fund. § 221103. Purpose and Expenditures. The HAHS Fund shall be expended by Legislative appropriation as follows: (1) seventy-five percent (75%) to finance various health care programs and projects, and other educational programs for tobacco prevention; and (2 ) Twenty-five percent (25%) to finance advance technological equi pment to COL4/6/20225 GCA GOVERNMENT OPERATIONS CH. 22 GENERAL FISCAL POLICIES AND CONTROLS 204 persons with disabilities, and other health program s specifically authorized by the Guam Legislature. § 221104. Administration. The Director of Administration shall account for, and administer, the HAHS Fund.

th disabilities, and other health program s specifically authorized by the Guam Legislature. § 221104. Administration. The Director of Administration shall account for, and administer, the HAHS Fund. The Director shall keep all books, records, files and account of the HAHS Fund. The Di rector shall prepare semi-annual reports relative to the HAHS Fu nd reflecting the transactions and financial condition of the HAH S Fund which semi-annual reports shall be transmitted to the Gov ernor and the Speaker of the Guam Legislature. § 221105. Designation of Single Agency; Promulgatio n of Rules and Regulations. (a) Designation. The Department of Public Health a nd Social Services (‘DPHSS’) is hereby designated as the ‘sin gle agency’ for Guam resulting from the Federal settlement. The DPHSS shall be charged with the following responsibilities: (1) maintaining a licensing procedure, such that an y business which sells tobacco products directly to c onsumers would have to apply for a special license; (2) conduct random, unannounced inspections at leas t monthly to ensure compliance with no sales to minor s; (3) meet targets of a minimum of seventy-five perce nt (75%), the percentage

cial license; (2) conduct random, unannounced inspections at leas t monthly to ensure compliance with no sales to minor s; (3) meet targets of a minimum of seventy-five perce nt (75%), the percentage expressed as a percentage of all random inspections in which the retailer refused sa le of tobacco to minors; and (4) submit an annual report to the Food and Drug Administration, to the Speaker of the Guam Legislat ure and to the Governor of Guam concerning: (A) detailed description of enforcement activities undertaken; (B) detailed description of Guam’s progress in reducing availability of tobacco products; (C) detailed description of methods used in compliance checks and in identifying outlets which COL4/6/20225 GCA GOVERNMENT OPERATIONS CH. 22 GENERAL FISCAL POLICIES AND CONTROLS 205 were tested; (D) detailed description of strategies Guam intends to use in succeeding years to make further progress ; and (E) identify a single agency responsible for fulfilling the Act’s requirements. (b) Promulgation of Rules and Regulations. The Dire ctor of DPHSS is hereby directed to promulgate rules and re gulations regarding the implementation of the provisions of t his Act, including revising

) Promulgation of Rules and Regulations. The Dire ctor of DPHSS is hereby directed to promulgate rules and re gulations regarding the implementation of the provisions of t his Act, including revising and creating forms and other doc uments, as are necessary in accordance with the procedures prescri bed by the Administrative Adjudication Law. 2012 NOTE: In maintaining the general codification scheme of t he GCA the Compiler changed the hierarchy of subsections b eginning with 'Lowercase Roman Numerals' to 'Uppercase Letters' i n subsection (a)(4). § 221106. Staffing, Funding, Initial Set Up. (a) The Director of DPHSS is hereby authorized to employ the services of two (2) new investigative/administr ative staff positions to make the required inspections, reports and for the purpose of implementing the Department’s responsibi lities as prescribed in § 221005 of this Article and the requ irements of the Federal tobacco settlement. (b) The Director is hereby authorized to expend the necessary sums not to exceed One Hundred Thousand Dollars ($1 00,000.00) from the Fund for the purpose of funding the initia l set up, such as office supplies, equipment, public education, etc., and a copy

ary sums not to exceed One Hundred Thousand Dollars ($1 00,000.00) from the Fund for the purpose of funding the initia l set up, such as office supplies, equipment, public education, etc., and a copy of the report shall be filed with the Speaker of the G uam Legislature and the Governor of Guam within thirty (30) days. § 221107. Appropriation and Exemption. The HAHS Fund shall not be used for any purpose ot her than those enumerated or reasonably inferred herein or f or purposes other than those relating to health care. Specifica lly, the HAHS Fund shall not be used as a pledge of security or a s collateral for government loans without prior authorization by the Guam Legislature. The total expenditures appropriated fr om the HAHS Fund shall not exceed eighty percent (80%) of the a vailable COL4/6/20225 GCA GOVERNMENT OPERATIONS CH. 22 GENERAL FISCAL POLICIES AND CONTROLS 206 balance. The remaining twenty percent (20%) balance in the HAHS Fund shall be administered by the Guam Economi c Development Authority for investment purposes into a portfolio that mirrors the Retirement Fund’s investment portf olio.

ent (20%) balance in the HAHS Fund shall be administered by the Guam Economi c Development Authority for investment purposes into a portfolio that mirrors the Retirement Fund’s investment portf olio. The proceeds from the investments shall remain within t he HAHS Fund and shall be maintained separate and apart fro m other GEDA funds. § 221108. Deposit. (a) All monies deposited into the HAHS Fund shall b e expended exclusively for the purposes enumerated in 5 GCA § 221003 and the general intent of this Act. (b) The HAHS Fund, subject to legislative approval, may be invested or reinvested in bonds or in securities th at are approved for the Retirement Fund, or according to modern inv estment practices of similar funds. The appropriations fro m the HAHS Fund received pursuant to § 221203 of Title 5 of th e Guam Code Annotated shall be limited to fifty percent (50%) o f the initial deposit from the proceeds of the sale for the first five (5) years. Thereafter, expenditures shall be limited to ninety percent (90%) of the earnings of the Fund. SOURCE: Amended by P.L. 25-150:17; 26-003:6; 28-042:8. § 221109. Interest.

for the first five (5) years. Thereafter, expenditures shall be limited to ninety percent (90%) of the earnings of the Fund. SOURCE: Amended by P.L. 25-150:17; 26-003:6; 28-042:8. § 221109. Interest. Notwithstanding the provisions of §§ 21103, 21107 a nd 21110, all of Title 5 of the Guam Code Annotated, o r any other provisions of Guam law to the contrary, all interes t earned by the HAHS Fund shall remain within the HAHS Fund. ---------- ARTICLE 12 RESERVE FUND FOR NON - PARTICIPATING TOBACCO MANUFACTURERS SOURCE : Article added by P.L. 25-150:15 (July 7, 2000). § 221201. Findings and Purpose. § 221202. Definitions COL4/6/20225 GCA GOVERNMENT OPERATIONS CH. 22 GENERAL FISCAL POLICIES AND CONTROLS 207 § 221203. Requirements § 221201. Findings and Purpose. (a) Cigarette smoking presents serious public healt h concerns to the State and to the citizens of the State. The Surgeon General has determined that smoking causes lung cancer, hea rt disease and other serious diseases, and that there are hundreds of thousands of tobacco-related deaths in the United States each ye ar. These diseases most often do not appear until many years after the person in question begins smoking.

d that there are hundreds of thousands of tobacco-related deaths in the United States each ye ar. These diseases most often do not appear until many years after the person in question begins smoking. (b) Cigarette smoking also presents serious financi al concerns for the State. Under certain health-care programs, the State may have a legal obligation to provide medical assistan ce to eligible persons for health conditions associated with cigar ette smoking, and those persons may have a legal entitlement to r eceive such medical assistance. (c) Under these programs, the State pays millions o f dollars each year to provide medical assistance for these p ersons for health conditions associated with cigarette smoking. (d) It is the policy of the State that financial bu rdens imposed on the State by cigarette smoking be borne by tobac co product manufacturers rather than by the State to the exten t that such manufacturers either determine to enter into a sett lement with the State or are found culpable by the courts. (e) On November 23, 1998, leading United States tob acco product manufacturers entered into a settlement agr eement, entitled the 'Master Settlement Agreement,' with the

found culpable by the courts. (e) On November 23, 1998, leading United States tob acco product manufacturers entered into a settlement agr eement, entitled the 'Master Settlement Agreement,' with the State. The Master Settlement Agreement obligates these manufacturers, in return for a release of past, present and certain future claim s against them as described therein, to pay substantial sums to the S tate (tied in part to their volume of sales); to fund a national found ation devoted to the interests of public health; and to make substan tial changes in their advertising and marketing practices and corpo rate culture, with the intention of reducing underage smoking. (f) It would be contrary to the policy of the State if tobacco product manufacturers who determine not to enter in to such a settlement could use a resulting cost advantage to derive large, COL4/6/20225 GCA GOVERNMENT OPERATIONS CH. 22 GENERAL FISCAL POLICIES AND CONTROLS 208 short-term profits in the years before liability ma y arise without ensuring that the State will have an eventual sourc e of recovery from them if they are proven to have acted culpably .

ONTROLS 208 short-term profits in the years before liability ma y arise without ensuring that the State will have an eventual sourc e of recovery from them if they are proven to have acted culpably . It is thus in the interest of the State to require that such manu facturers establish a reserve fund to guarantee a source of compensatio n and to prevent such manufacturers from deriving large, short-term profits and then becoming judgment-proof before liability may arise. SOURCE : Added by P.L. 25-150:15 (July 7, 2000), amended b y P.L. 26- 003:2 (Mar. 14, 2001), repealed/reenacted by P.L. 2 6-007:1 (May 16, 2001). § 221202. Definitions. (a) 'Adjusted for inflation' means increased in acc ordance with the formula for inflation adjustment set forth in Exhibit C to the Master Settlement Agreement. (b) 'Affiliate' means a person who directly or indi rectly owns or controls, is owned or controlled by, or is under common ownership or control with, another person. Solely for purposes of this definition, the terms 'owns,' 'is owned' and ' ownership' mean ownership of an equity interest, or the equiva lent thereof, of ten percent (10%) or more, and the term 'person' me ans an individual,

s definition, the terms 'owns,' 'is owned' and ' ownership' mean ownership of an equity interest, or the equiva lent thereof, of ten percent (10%) or more, and the term 'person' me ans an individual, partnership, committee, association, co rporation or any other organization or group of persons. (c) 'Allocable share' means Allocable Share as that term is defined in the Master Settlement Agreement. (d) 'Cigarette' means any product that contains nic otine, is intended to be burned or heated under ordinary cond itions of use, and consists of or contains (1) any roll of tobacco wrapped in paper or in any substance not containing tobacco; or (2) tobacco, in any form, that is functional in the product, which, because of its appearance, the type of tobacco used in the filler, or its packaging and la beling, is likely to be offered to, or purchased by, consumers as a cigarette; or (3) any roll of tobacco wrapped in any substance containing tobacco which, because of its appearance , the type COL4/6/20225 GCA GOVERNMENT OPERATIONS CH. 22 GENERAL FISCAL POLICIES AND CONTROLS 209 of tobacco used in the filler, or its packaging and labeling, is likely to be offered to, or purchased by,

type COL4/6/20225 GCA GOVERNMENT OPERATIONS CH. 22 GENERAL FISCAL POLICIES AND CONTROLS 209 of tobacco used in the filler, or its packaging and labeling, is likely to be offered to, or purchased by, consumers as a cigarette described in clause (1) of this definitio n. The term 'cigarette' includes 'roll-your-own' (i.e. , any tobacco which, because of its appearance, type, packaging, or labeling is suitable for use and likely to be offered to, or pu rchased by, consumers as tobacco for making cigarettes). For p urposes of this definition of 'cigarette,' 0.09 ounces of 'roll-you r-own' tobacco shall constitute one (1) individual 'cigarette.' (e) 'Master Settlement Agreement' means the settlem ent agreement (and related documents) entered into on N ovember 23, 1998 by the State and leading United States tobacco product manufacturers. (f) 'Qualified escrow fund' means an escrow arrange ment with a federally or State chartered financial insti tution having no affiliation with any tobacco product manufacturer a nd having assets of at least $1,000,000,000 where such arrang ement requires that such financial institution hold the escrowed f unds principal for the benefit of releasing

cco product manufacturer a nd having assets of at least $1,000,000,000 where such arrang ement requires that such financial institution hold the escrowed f unds principal for the benefit of releasing parties and prohibits the tobacco product manufacturer placing the funds into escrow from using, accessing or directing the use of the funds princip al except as consistent with section 221203(b). (g) 'Released claims' means Released Claims as that term is defined in the Master Settlement Agreement. (h) 'Releasing parties' means Releasing Parties as that term is defined in the Master Settlement Agreement. (i) 'Tobacco Product Manufacturer' means an entity that after the date of enactment of this article directl y (and not exclusively through any affiliate): (1) manufactures cigarettes anywhere that such manufacturer intends to be sold in the United State s, including cigarettes intended to be sold in the Uni ted States through an importer (except where such importer is an original participating manufacturer (as that term i s defined in the Master Settlement Agreement) that will be respo nsible for the payments under the Master Settlement Agreem ent COL4/6/20225 GCA GOVERNMENT

participating manufacturer (as that term i s defined in the Master Settlement Agreement) that will be respo nsible for the payments under the Master Settlement Agreem ent COL4/6/20225 GCA GOVERNMENT OPERATIONS CH. 22 GENERAL FISCAL POLICIES AND CONTROLS 210 with respect to such cigarettes as a result of the provisions of subsection II (mm) of the Master Settlement Agreeme nt and that pays the taxes specified in subsection II (z) of the Master Settlement Agreement, and provided that the manufac turer of such cigarettes does not market or advertise such c igarettes in the United States); (2) is the first purchaser anywhere for resale in t he United States of cigarettes manufactured anywhere t hat the manufacturer does not intend to be sold in the Unit ed States; or (3) becomes a successor of an entity described in Paragraph (1) or (2). The term 'Tobacco Product Manufacturer' shall not include an affiliate of a t obacco product manufacturer unless such affiliate itself f alls within any of Paragraph (1) through (3) above. (j) 'Units sold' means the number of individual cig arettes sold in the State by the applicable tobacco product manufacturer (whether directly or through a

hin any of Paragraph (1) through (3) above. (j) 'Units sold' means the number of individual cig arettes sold in the State by the applicable tobacco product manufacturer (whether directly or through a distributor, retaile r or similar intermediary or intermediaries) during the year in question, as measured by excise taxes collected by the State on packs (or 'roll- your-own' tobacco containers) bearing the excise ta x stamp of the State. The Department of Revenue and Taxation shall promulgate such regulations as are necessary to ascertain the amount of State excise tax paid on the cigarettes of such tobacco p roduct manufacturer for each year. (k) 'State' means Guam or the government of Guam, as the case may be. SOURCE : Added by P.L. 25-150:15 (July 7, 2000), amended b y P.L. 26- 003:3 (Mar. 14, 2001), repealed/reenacted by P.L. 26-007:2 (May 16, 2001). § 221203. Requirements. Any tobacco product manufacturer selling cigarette s to consumers within the State (whether directly or thr ough a distributor, retailer or similar intermediary or in termediaries) after the date of enactment of this article shall do one of the following: COL4/6/20225 GCA GOVERNMENT OPERATIONS CH.

y or thr ough a distributor, retailer or similar intermediary or in termediaries) after the date of enactment of this article shall do one of the following: COL4/6/20225 GCA GOVERNMENT OPERATIONS CH. 22 GENERAL FISCAL POLICIES AND CONTROLS 211 (a) become a participating manufacturer (as that te rm is defined in section II (jj) of the Master Settlem ent Agreement) and generally perform its financial obli gations under the Master Settlement Agreement; or (b) (1) place into a qualified escrow fund by Apri l 15 of the year following the year in question the foll owing amounts (as such amounts are adjusted for inflation ) -- 2000: $.0104712 per unit sold after the date of enactment of this article; For each of 2001 and 2002: $.0136125 per unit sold; For each of 2003 through 2006: $.0167539 per unit sold; For each of 2007 and each year thereafter: $.0188482 per unit sold. (2) A tobacco product manufacturer that places funds into escrow pursuant to Paragraph (1) shall receive the interest or other appreciation on such funds as earned. Such funds themselves shall be released from escrow only under the following circumstances: (A) to pay a judgment or settlement on any released claim

st or other appreciation on such funds as earned. Such funds themselves shall be released from escrow only under the following circumstances: (A) to pay a judgment or settlement on any released claim brought against such tobacco product manufacturer by the State or any releasing party located or residing in the State. Funds shal l be released from escrow under this Subparagraph (i) in the order in which they were placed into escrow and (ii) only to the extent and at the time necessary to make payments required under such judgment or settlement; (B) to the extent that a tobacco product manufacturer establishes that the amount it was required to place into escrow in a particular year was greater than the State’s allocable share of the total payments that such manufacturer would have been required to make in that year under the Master Settlement Agreement (as determined pursuant to COL4/6/20225 GCA GOVERNMENT OPERATIONS CH. 22 GENERAL FISCAL POLICIES AND CONTROLS 212 section IX (i)(2) of the Master Settlement Agreement, and before any of the adjustments or offsets described in section IX (i)(3) of that Agreement other than the Inflation Adjustment) had it been a participating

)(2) of the Master Settlement Agreement, and before any of the adjustments or offsets described in section IX (i)(3) of that Agreement other than the Inflation Adjustment) had it been a participating manufacturer, the exces s shall be released from escrow and revert back to such tobacco product manufacturer; or (C) to the extent not released from escrow under Subparagraphs (A) or (B), funds shall be released from escrow and revert back to such tobacco product manufacturer twenty-five (25) years after the date on which they were placed into escrow. (3) Each tobacco product manufacturer that elects to place funds into escrow pursuant to this subsect ion shall annually certify to the Attorney General that it is in compliance with this subsection. The Attorney General may bring a civil action on behalf of the S tate against any tobacco product manufacturer that fails to place into escrow the funds required under this sec tion. Any tobacco product manufacturer that fails in any year to place into escrow the funds required under this Section shall: (A) be required within fifteen (15) days to place such funds into escrow as shall bring it into compliance with this section.

ny year to place into escrow the funds required under this Section shall: (A) be required within fifteen (15) days to place such funds into escrow as shall bring it into compliance with this section. The court, upon a finding of a violation of this subsection, may impose a civil penalty to be paid to the General Fund in an amount not to exceed five percent (5%) of the amount improperly withheld from escrow per day of the violation and in a total amount not to exceed one hundred percent (100%) of the original amount improperly withheld from escrow; (B) in the case of a knowing violation, be required within fifteen (15) days to place such funds into escrow as shall bring it into compliance with this section. The court, upon a finding of a knowing violation of this subsection, may impose COL4/6/20225 GCA GOVERNMENT OPERATIONS CH. 22 GENERAL FISCAL POLICIES AND CONTROLS 213 a civil penalty to be paid to the General Fund in a n amount not to exceed fifteen percent (15%) of the amount improperly withheld from escrow per day of the violation and in a total amount not to excee d three hundred percent (300%) of the original amount improperly withheld from escrow; and (C) in the case of a

operly withheld from escrow per day of the violation and in a total amount not to excee d three hundred percent (300%) of the original amount improperly withheld from escrow; and (C) in the case of a second knowing violation, be prohibited from selling cigarettes to consumers within the State (whether directly or through a distributor, retailer or similar intermediary) for a period not to exceed two (2) years; and (D) be required to pay the State’s costs and attorney’s fees incurred during a successful prosecution of any action brought under this Paragraph (3). (4) Each failure to make an annual deposit require d under this section shall constitute a separate viol ation. SOURCE : Added by P.L. 25-150:15 (July 7, 2000), amended b y P.L. 26- 003:4 (Mar. 14, 2001), repealed/reenacted by P.L. 2 6-007:3 (May 16, 2001). ---------- ARTICLE 13 SECURITIZATION OF TOBACCO SETTLEMENT PAYMENTS SOURCE : Added as Article 12, §§ 221201-221206, by P.L. 2 5- 187:2 (Jan. 11, 2001), renumbered by Compiler beca use Article 12 already exists. § 221301. Definitions. § 221302. GEDA Request. § 221303. Distribution of Proceeds. § 221304. Health Security Trust Fund. § 221305.

1, 2001), renumbered by Compiler beca use Article 12 already exists. § 221301. Definitions. § 221302. GEDA Request. § 221303. Distribution of Proceeds. § 221304. Health Security Trust Fund. § 221305. UOG Higher Education Endowment Funds. § 221306. GCC Endowment Funds. § 221301. Definitions. COL4/6/20225 GCA GOVERNMENT OPERATIONS CH. 22 GENERAL FISCAL POLICIES AND CONTROLS 214 As used in this Article: (a) Guam Allocation means all moneys payable to Guam pursuant to the MSA, without giving effect to any sale of any portion thereof. (b) Master Settlement Agreement or MSA means the settlement agreement and related documents between Guam and leading United States tobacco product manufactu rers dated November 23, 1998. § 221302. GEDA Request . Guam Economic Development Authority shall solicit through the request for proposal process for qualified and licensed investment banking firms for investment services fo r the purpose of selling or securitizing the Guam Allocation made under the Master Settlement Agreement entered into between th e government of Guam and leading tobacco manufacturer s.

nt services fo r the purpose of selling or securitizing the Guam Allocation made under the Master Settlement Agreement entered into between th e government of Guam and leading tobacco manufacturer s. The method of financing shall be non-recourse to, and r equire no credit support by, the government of Guam. The terms of t he sale and securitization shall be submitted to I Liheslaturan Guåhan for approval. § 221303. Distribution of Proceeds. Proceeds of the sale and securitization of the Gua m Allocation received by the government of Guam shall be distrib uted in the following manner: (a) fifty percent (50%) into the Health Security T rust Fund; (b) fifteen percent (15%) into the UOG Endowment Fund; (c) fifteen percent (15%) into the GCC Endowment Fund; (d) ten percent (10%) into the Youth Tobacco Educa tion and Prevention Fund; and (e) ten percent (10%) into the Health and Human Services Fund. 2012 NOTE: In maintaining the general codification scheme of t he GCA COL4/6/20225 GCA GOVERNMENT OPERATIONS CH. 22 GENERAL FISCAL POLICIES AND CONTROLS 215 the Compiler changed the hierarchy of subsections b eginning with 'Numbers' to 'Lowercase Letters' in this section. § 221304.

GCA GOVERNMENT OPERATIONS CH. 22 GENERAL FISCAL POLICIES AND CONTROLS 215 the Compiler changed the hierarchy of subsections b eginning with 'Numbers' to 'Lowercase Letters' in this section. § 221304. Health Security Trust Fund. (a) There is hereby created, separate and apart fro m other funds of the government of Guam, a fund known as th e Health Security Trust Fund. The Health Security Trust Fun d shall not be commingled with the General Fund and shall be kept in a separate bank account, and shall be subject to legislative a ppropriation and expended exclusively for the purpose of funding the operations and capital expenditure at the Guam Memorial Hospit al. (b) The Health Security Trust Fund, subject to legi slative approval, may be invested or reinvested in bonds or in securities that are approved for the Retirement Fund, or accor ding to modern investment practices of similar funds. The appropri ations from the Health Security Trust Fund shall be limited to fift y percent (50%) of the initial deposit from the proceeds of the sal e for the first five (5) years. Thereafter, expenditures shall be limite d to ninety percent (90%) of the earnings of the Fund.

ift y percent (50%) of the initial deposit from the proceeds of the sal e for the first five (5) years. Thereafter, expenditures shall be limite d to ninety percent (90%) of the earnings of the Fund. (c) The sum of Three Million Five Hundred Thousand Dollars ($3,500,000) is transferred from the presen t series 2001B sub-account of the Health Securities Trust Fund to the 2001A sub- account and is de-allocated and subsequently approp riated to the Guam Memorial Hospital Authority for support of the operations of the Guam Memorial Hospital. This transfer is con ditional upon the approval of bond counsel. SOURCE: Added as § 221204, by P.L. 25-187:2 (Jan. 11, 2001) , codified to this section by the Compiler. Subsection (b) am ended by P.L. 27-0069:6 (Feb. 6, 2004) and P.L. 28-042:3 (June 3, 2005). Su bsection (c) added by P.L. 28-068:II:III:4 (Sept. 30, 2005), which appare ntly mis-numbered the section as 221204. § 221305. UOG Higher Education Endowment Funds. There is hereby created, separate and apart from ot her funds of the government of Guam, a fund known as the ‘UOG Higher Education Endowment Fund’.

04. § 221305. UOG Higher Education Endowment Funds. There is hereby created, separate and apart from ot her funds of the government of Guam, a fund known as the ‘UOG Higher Education Endowment Fund’. The UOG Higher Educatio n Endowment Fund shall not be commingled with the Gen eral Fund and shall be kept in a separate bank account and ad ministered by the University of Guam. The UOG Higher Education E ndowment Fund may be invested or reinvested by the UOG Board of Regents COL4/6/20225 GCA GOVERNMENT OPERATIONS CH. 22 GENERAL FISCAL POLICIES AND CONTROLS 216 in bonds or in securities that are approved for the Retirement Fund, or according to modern investment practices o f similar funds. The appropriations from the UOG Higher Education Endowment Fund shall be limited to fifty percent (5 0%) of the initial deposit from the proceeds of the sale for t he first five (5) years. Thereafter, expenditures shall be limited to ninety percent (90%) of the earnings of the Fund. The proceeds fr om the investments shall remain within the UOG Higher Educ ation Endowment Fund. All monies deposited into the UOG Higher Education Endowment Fund shall be expended exclusiv ely for enhancement of

fr om the investments shall remain within the UOG Higher Educ ation Endowment Fund. All monies deposited into the UOG Higher Education Endowment Fund shall be expended exclusiv ely for enhancement of learning resources and technology, i ncluding, but not limited to, the following: (a) purchase of computer equipment, books, subscriptions, periodical materials and other libra ry supplies and materials; (b) training; and (c) management of library materials and resources. The University of Guam shall determine the allocati on of this appropriation in compliance with this Section. SOURCE : Added as § 221205, by P.L. 25-187:2 (Jan. 11, 20 01), codified to this section by the Compiler. Amended by P.L. 2 7-069:6(c) (Feb. 6, 2004) and P.L. 28-042:4 (June 3, 2005). § 221306. GCC Endowment Fund. There is hereby created, separate and apart from ot her funds of the government of Guam, a fund known as the ‘GCC Endowment Fund.’ The GCC Endowment Fund shall not be commingled with the General Fund and shall be kept in a separate bank account and administered by the Guam Community College. The GCC Endowment Fund may be invested or reinveste d by the GCC Board of Trustees in bonds or in securities

d shall be kept in a separate bank account and administered by the Guam Community College. The GCC Endowment Fund may be invested or reinveste d by the GCC Board of Trustees in bonds or in securities tha t are approved for the Retirement Fund, or according to modern inv estment practices of similar funds. The appropriations from the GCC Endowment Fund shall be limited to fifty percent (5 0%) of the initial deposit from the proceeds of the sale for t he first five (5) years. Thereafter, expenditures shall be limited t o ninety percent COL4/6/20225 GCA GOVERNMENT OPERATIONS CH. 22 GENERAL FISCAL POLICIES AND CONTROLS 217 (90%) of the earnings of the Fund. The proceeds fr om the investments shall remain within the GCC Endowment F und. All monies deposited into the GCC Endowment Fund shall be expended exclusively for enhancement of learning re sources and technology, and for the purpose of funding capital improvement projects expenditures at GCC, including, but not li mited to, the following: (a) purchase of computer equipment, books, subscriptions, periodical materials and other libra ry supplies and materials; (b) training; (c) management of library materials and resources; and (d)

ing: (a) purchase of computer equipment, books, subscriptions, periodical materials and other libra ry supplies and materials; (b) training; (c) management of library materials and resources; and (d) capital improvement projects. GCC shall determine the allocation of this appropri ation in compliance with this Section. SOURCE : Added as § 221206, by P.L. 25-187:2 (Jan. 11, 200 1), codified to this section by the Compiler. Amended by P.L. 2 7-011:2 (Apr. 26, 2003), P.L. 27-069:6(d) (Feb. 6, 2004), and P.L. 28 -042:5 (June 3, 2005). ---------- ARTICLE 14 COMPACT IMPACT GRANT ANTICIPATION BONDS SOURCE : Entire Article enacted by P.L. 27-092:1. NOTE : See Organic Act § 1423j. Moneys appropriated by Congress to Guam may not be appropriated again by the Guam L egislature. 'Section 1423j of Title 48, United States Code, is paramount to local legislation [this Article] and p rovides that the United States Congress can make appropriat ions directly to the government of Guam. Where these appropriations or grants completely fund a specific purpose without the need of local funding, and wher e the appropriation or grant does not provide for local legislative control, there is no authority for

iations or grants completely fund a specific purpose without the need of local funding, and wher e the appropriation or grant does not provide for local legislative control, there is no authority for the Guam Legislature to assume the responsibility for reappr opria- ting these funds.' Wong, Deputy Consumer Counsel v. Camina, Director, Bureau of Budget & Management Research, 2 Guam R. 132, 133 (1978). COL4/6/20225 GCA GOVERNMENT OPERATIONS CH. 22 GENERAL FISCAL POLICIES AND CONTROLS 218 § 221401. Legislative Findings and Intent. § 221402. Compact Impact Grant Anticipation Bonds. § 221403. Compact Impact Grant Anticipation Bonds. § 221404. Bond Proceeds. § 221405. Procurement. § 221406. Selection of Participants. § 221407. Need for Completion. § 221408. Bond Interest. § 221409. Legislative Approval Required. § 221410. Same. § 221411. GMHA Board Action. § 221412. DPHSS Action. § 221413. Creation of the Capital Infrastructure an d Maintenance Fund. § 221401. Legislative Findings and Intent. I Liheslaturan Guåhan [The Legislature] finds that education, health and safety are among the many gov ernment responsibilities whose facilities have required muc h improvement and expansion.

Intent. I Liheslaturan Guåhan [The Legislature] finds that education, health and safety are among the many gov ernment responsibilities whose facilities have required muc h improvement and expansion. As stakeholders, all of Guam’s resi dents, temporary visitors, and new immigrants have an inte rest in the improvement of these vital services. I Liheslaturan Guåhan [The Legislature] finds that almost all of Guam’s public school buildings have fallen i nto some degree of disrepair. Some school facilities alread y have deteriorated to the point that they cannot be occup ied, forcing schools to share classrooms with other schools. Wh ether the cause of disrepair is age, natural disaster, or a simple lack of regular care and maintenance, it is of great public interest tha t existing public schools be repaired and refurbished and new public school buildings be constructed to standards optimally con ducive to student learning. Further, I Liheslaturan Guåhan [The Legislature] finds that for many years, the number of public schools have n ot kept pace with the trends in Guam’s population. As a result, many of Guam’s public schools have become overcrowded, at t imes far surpassing the

for many years, the number of public schools have n ot kept pace with the trends in Guam’s population. As a result, many of Guam’s public schools have become overcrowded, at t imes far surpassing the student capacities they originally h ad been designed to accommodate. Consequently, Guam’s educa tors on a COL4/6/20225 GCA GOVERNMENT OPERATIONS CH. 22 GENERAL FISCAL POLICIES AND CONTROLS 219 daily basis have had to overcome the challenges of teaching students in an environment that often detracts from , rather than enhances, the teaching-and-learning process. At the same time, but in a different area of need, the people of Guam also have had to cope with the Guam Memoria l Hospital’s CT Scan System that has nearly surpassed its useful life and also is in great need of technological update. I Liheslatura also recognizes the much-needed expansion and redes ign of the emergency medical department, as well as the need t o establish an endoscopy suite on Guam. Moreover, I Liheslaturan Guåhan [The Legislature] realizes that the Department of Public Health and Social Ser vices regional community health clinics are unable to accommodate the population increases in the island’s villages,

han [The Legislature] realizes that the Department of Public Health and Social Ser vices regional community health clinics are unable to accommodate the population increases in the island’s villages, and therefore, would require expansion of the health centers, or in some cases, may require additional ones. Less visible to the general public yet very importa nt to the overall safety of the community, Guam’s Adult Corre ctional Facility requires safety upgrades in order to meet mandates set forth by the U.S. Federal government in a Consent D ecree entered into between the government of Guam and the Federal government as a result of a lawsuit. These safety upgrades, which include fire control and entry control devices, wou ld ensure adequate security for Guam’s people and safety for the facility’s personnel and inmates. I Liheslatura finds that the interests of public security and the humane delivery of justice demand that these upgrades be completed without further delay. I Liheslaturan Guåhan [The Legislature] further recognizes that the repair and refurbishment of existing publi c schools, the construction of new public schools, the establishme nt of healthcare facilities, and

ran Guåhan [The Legislature] further recognizes that the repair and refurbishment of existing publi c schools, the construction of new public schools, the establishme nt of healthcare facilities, and safety upgrades to the p rison are expensive endeavors. However, they are investments of vital importance to the island’s future. While the finan cing of large projects is difficult, it is neither an insurmounta ble obstacle, nor a necessarily reckless and risky financial undertakin g. This legislative body is mindful of the need for new fac ilities but also equally mindful that the price of educating our stu dents, COL4/6/20225 GCA GOVERNMENT OPERATIONS CH. 22 GENERAL FISCAL POLICIES AND CONTROLS 220 improving health care, and ensuring security does n ot have to be a huge debt on the backs of our children and grandc hildren. Therefore, it is the intent of I Liheslaturan Guåhan [The Legislature] to enable the financing for the repai r and refurbishment of existing public schools, the const ruction of new public schools, the replacement of the CT Scan Syst em and the establishment of an endoscopy suite at the Guam Mem orial Hospital, the expansion and the redesign of the eme rgency

onst ruction of new public schools, the replacement of the CT Scan Syst em and the establishment of an endoscopy suite at the Guam Mem orial Hospital, the expansion and the redesign of the eme rgency medical department of the Guam Memorial Hospital, t he expansion of the Department of Public Health and So cial Services regional community health clinics or the constructi on of new ones, and safety upgrades to our prison facility; thereby investing in a solid future for Guam’s people, while ensuring that this same investment is not compromised by large public debt. I Liheslatura further finds that the securitization of future revenue streams to be received by the government of Guam is an acceptable source of repayment of bonds issued with no recourse to full faith and credit of the government for repa yment. I Liheslatura successfully issued bonds using this method with t he securitization of the future payments of the master settlement agreement between the tobacco companies and the var ious states attorneys general. In addition, other state and lo cal governments have done the same with revenues of Federal grants to states authorized by Congress.

n the tobacco companies and the var ious states attorneys general. In addition, other state and lo cal governments have done the same with revenues of Federal grants to states authorized by Congress. For Guam, we have such an opportunity to maximize t he future revenues of the Compact Impact reimbursement s authorized for twenty (20) years by the recent re-a uthorization in United States Public Law 108-188 of the Compact of Free Association. The securitization of these future rev enues can be used to issue bonds of a sufficient amount to accom plish the projects authorized herein that will result in an e conomic stimulus that creates new jobs and increased government reve nues. § 221402. Compact Impact Grant Anticipation Bonds. (a) Subject to the provisions of this Article, I Maga’lahi , [the Governor] through the Guam Economic Development and Commerce Authority (hereinafter ‘GEDCA’), may issue Compact Impact Grant Anticipation Bonds for the purposes of financing the COL4/6/20225 GCA GOVERNMENT OPERATIONS CH. 22 GENERAL FISCAL POLICIES AND CONTROLS 221 construction, repair and refurbishing of public sch ool buildings, the replacement of the CT Scan System and the estab lishment of

OVERNMENT OPERATIONS CH. 22 GENERAL FISCAL POLICIES AND CONTROLS 221 construction, repair and refurbishing of public sch ool buildings, the replacement of the CT Scan System and the estab lishment of an endoscopy suite of the Guam Memorial Hospital, t he expansion and the redesign of the emergency medical departmen t at the Guam Memorial Hospital Authority, the expansion of the Department of Public Health and Social Services reg ional community health clinics or the construction of new ones, and the upgrading of the Department of Correction’s Adult C orrectional Facility (hereinafter ‘DOC ACF’). (b) (1) The power to fix the date of sale of the C ompact Impact Grant Anticipation Bonds, to award and sell the Compact Impact Grant Anticipation Bonds, to fix int erest rates, and to take all other action necessary to se ll and deliver the bonds shall be delegated by I Maga’lahi to GEDCA. (2) (A) GEDCA shall issue the Request for Proposals for the Compact Impact Grant Anticipation Bonds, within fifteen (15) days after the enactment of thi s Subsection, based on the following terms and conditions: The terms and conditions of the bonds shall be as determined by GEDCA by the execution of a

hin fifteen (15) days after the enactment of thi s Subsection, based on the following terms and conditions: The terms and conditions of the bonds shall be as determined by GEDCA by the execution of a certifica te, or indenture authorizing the issuance of the bonds upon, or prior to the issuance of the bonds; provided, ho wever, that such terms and conditions shall be consistent with this Article, and that the bonds shall mature not l ater than the year 2024, and shall bear interest at such rates and be sold for such price or prices, as shall resu lt in a yield to the bondholders not exceeding seven percen t (7%) per annum. (B) GEDCA shall be authorized to receive bids or proposals on the Compact Impact Grant Anticipation (c) (1) Subject to the provisions of this Subsecti on (3), the principal of and interest on the Compact Impact Gra nt Anticipation Bonds shall be payable solely from: (A) money available as Compact Impact Aid for Guam under Section 104(c)(6) of U.S. Public Law 99- COL4/6/20225 GCA GOVERNMENT OPERATIONS CH. 22 GENERAL FISCAL POLICIES AND CONTROLS 222 239, and as recently reauthorized in U.S.

act Impact Aid for Guam under Section 104(c)(6) of U.S. Public Law 99- COL4/6/20225 GCA GOVERNMENT OPERATIONS CH. 22 GENERAL FISCAL POLICIES AND CONTROLS 222 239, and as recently reauthorized in U.S. Public La w 108-188 for the next twenty (20) years; and (B) any other revenues, funds, or other security pledged for such purpose that do not constitute rev enues or funds of the government of Guam. (2) The owners or holders of the Compact Impact Gra nt Anticipation Bonds may not look to any other revenu es of the government of Guam for the payment of the bonds . (3) The method of financing shall be non-recourse t o, and require no credit support by the government of Guam. (d) (1) GEDCA shall issue Compact Impact Grant Anticipation Bonds pursuant to a certificate execut ed by GEDCA, a trust indenture between GEDCA and any commercial bank or trust company having full trust powers, or any other instrument issued by GEDCA. (2) As GEDCA deems appropriate, the certificate, tr ust indenture, or other instrument authorizing the Comp act Impact Grant Anticipation Bonds may contain such provisions setting forth the rights and remedies of the owners or holders of the Compact Impact Grant

re, or other instrument authorizing the Comp act Impact Grant Anticipation Bonds may contain such provisions setting forth the rights and remedies of the owners or holders of the Compact Impact Grant Anticipation Bonds, may contain such provisions for protecting and enfo rcing the rights and remedies of the owners or holders of the Compact Impact Grant Anticipation Bonds as GEDCA deems appropriate, and may contain such other provisions that GEDCA deems appropriate for the security of the own ers or holders of the Compact Impact Grant Anticipation Bo nds. Such provisions may include, but not be limited to, provisions regarding letters of credit, insurance, stand-by credit agreements, or other forms of credit ensurin g timely payment of the Compact Impact Grant Anticipation Bo nds, including the redemption price or the purchase pric e, and provisions regarding the reimbursement of providers of such credit out of revenues available for the payment of principal of and interest on the Compact Impact Grant Anticip ation Bonds for any amounts paid by such providers with r espect to such bonds. COL4/6/20225 GCA GOVERNMENT OPERATIONS CH.

the payment of principal of and interest on the Compact Impact Grant Anticip ation Bonds for any amounts paid by such providers with r espect to such bonds. COL4/6/20225 GCA GOVERNMENT OPERATIONS CH. 22 GENERAL FISCAL POLICIES AND CONTROLS 223 (e) The Compact Impact Grant Anticipation Bonds may be issued in such aggregate principal amount, may be i ssued in one (1) or more series, may bear such dates, may be in such denomination or denominations, may mature on any da te or dates, may mature in such amount or amounts, may be in suc h form, may be payable at such place or places, may be subject to such terms of redemption with or without a premium, may contai n such provisions as GEDCA deems appropriate regarding ins urance to ensure the timely payment of the bonds, and may con tain such other provisions not inconsistent with the provisio ns of this Article as GEDCA may determine. (f) The rate or rates of interest borne by the Comp act Impact Grant Anticipation Bonds may be fixed, adjus table, or variable or any combination thereof without regard to any interest rate limitation appearing in any other laws of Guam .

by the Comp act Impact Grant Anticipation Bonds may be fixed, adjus table, or variable or any combination thereof without regard to any interest rate limitation appearing in any other laws of Guam . If any rate or rates are adjustable or variable, the standard, index, method, or formula shall be determined by GEDCA. (g) Compact Impact Grant Anticipation Bonds may be sold at public or private sale and may be sold at, above , or below the principal amounts thereof. The sale of such bonds shall not be subject to the Procurement Law. SOURCE : Added by P.L. 27-092:1. Subsections 2(a) and (b) amended by P.L. 27-106:VII:10. NOTE: Pursuant to the authority granted by 1 GCA § 1606, numbers and/or letters were altered to adhere to the Compil er’s alpha-numeric scheme. § 221403. Compact Impact Grants . Compact Impact Grant Anticipation Bonds issued by GEDCA pursuant to the provisions of this Article an d every contract relating to the issuance of such bonds sha ll provide that all financial obligations of the government of Guam in regard to the portion of the principal of and interest on suc h bonds that shall be paid from money available as Compact Impact Aid for Guam under Section

ial obligations of the government of Guam in regard to the portion of the principal of and interest on suc h bonds that shall be paid from money available as Compact Impact Aid for Guam under Section (104)(c)(6) of U.S. Public Law 99-239 and as recently reauthorized in U.S. Public Law 108-188 fo r the next twenty (20) years, pursuant to Federal laws and any agreement shall be subject to continuing Federal appropriatio ns of the money available as Compact Impact Aid for Guam under Sect ion COL4/6/20225 GCA GOVERNMENT OPERATIONS CH. 22 GENERAL FISCAL POLICIES AND CONTROLS 224 (104)(c)(6) of U.S. Public Law 99-239 and as recent ly reauthorized in U.S. Public Law 108-188 for the nex t twenty (20) years, at a level equal to or greater than the amou nt needed to pay principal and interest on the Compact Impact Grant Anticipation Bonds. § 221404. Bond Proceeds. All proceeds from the issuance of the Compact Impa ct Grant Anticipation Bonds in accordance with the provision s of this Article shall be credited to the Capital Infrastruc ture and Maintenance Fund to be used for the following purpo ses: (a) Construction of public schools and collateral equipment $88,000,000.00 [(1) two (2) high

ll be credited to the Capital Infrastruc ture and Maintenance Fund to be used for the following purpo ses: (a) Construction of public schools and collateral equipment $88,000,000.00 [(1) two (2) high schools not to exceed $56,000,000.00; (2) one (1) middle school not to exceed $16,000,000.00; and (3) two (2) elementary schools not to exceed $16,000,000.00] (b) Repairs & refurbishments $10,000,000.00 [payments for the repairs and refurbishments of existing public schools.] (c) Upgrade of DOC ACF $ 5,000,000.00 [construction of a new eighty-five (85) bed facility and upgrades required to meet the U.S. Department of Justice mandates towards resolution of the Consent Decree.] (d) replacement of CT Scan System $ 1,000,000.00 [as established in the Guam Memorial Hospital Authority Ten-Year Capital Improvements Plan.] (e) redesign and expansion of the emergency medical department $ 3,000,000.00 [as established in the Guam Memorial COL4/6/20225 GCA GOVERNMENT OPERATIONS CH. 22 GENERAL FISCAL POLICIES AND CONTROLS 225 Hospital Authority Ten-Year Capital Improvements Plan.] (f) establishment of an endoscopy suite $ 500,0 00.00 [as established in the Guam Memorial Hospital Authority Ten-Year

OLICIES AND CONTROLS 225 Hospital Authority Ten-Year Capital Improvements Plan.] (f) establishment of an endoscopy suite $ 500,0 00.00 [as established in the Guam Memorial Hospital Authority Ten-Year Capital Improvements Plan.] (g) expansion or construction of health clinics $ 2,000,000.00 [Department of Public Health and Social Services regional community health clinics.] (h) and any expenses relating to the authorization, sale and issuance of the bonds, including, without limit ation, printing costs, costs of reproducing documents, cre dit enhancement fees, underwriting, legal, financial ad visory and accounting fees and charges, fees paid to banks or other financial institutions providing credit enhancement , costs of credit ratings and other costs, charges and fees in connection with the issuance, sale and delivery of the bonds. 2012 NOTE: In maintaining the general codification scheme of t he GCA the Compiler changed the hierarchy of subsections b eginning with 'Numbers' to 'Lowercase Letters' and subsections be ginning with 'Lowercase Letters' to 'Numbers' in this section. § 221405. Procurement.

Compiler changed the hierarchy of subsections b eginning with 'Numbers' to 'Lowercase Letters' and subsections be ginning with 'Lowercase Letters' to 'Numbers' in this section. § 221405. Procurement. All projects enumerated in § 221404 of this Articl e shall be performed by private companies, subject to Chapter 5 of Title 5, Guam Code Annotated (Guam Procurement Law). § 221406. Selection of Participants. In view of the urgency for the issuance of the bon ds for the purpose of financing the projects enumerated in § 2 21404 of this Article, GEDCA is hereby authorized to utilize such method as it deems appropriate for the selection of all particip ants in connection with the issuance and sale of those bond s, including trustees, depositories, paying agents, underwriters , counsel, any credit enhancement provider and any other participa nts; provided, however, that such selection shall be subject to an y provision of law which requires bidding, other competitive proce ss, or any COL4/6/20225 GCA GOVERNMENT OPERATIONS CH. 22 GENERAL FISCAL POLICIES AND CONTROLS 226 other procedure with respect to such selection, exc ept that GEDCA may limit the Requests for Proposals for serv ices

6/20225 GCA GOVERNMENT OPERATIONS CH. 22 GENERAL FISCAL POLICIES AND CONTROLS 226 other procedure with respect to such selection, exc ept that GEDCA may limit the Requests for Proposals for serv ices associated with the issuance of the bonds to those firms that have previously participated in bond issues for Guam. § 221407. Need for Completion. It is the policy of I Liheslaturan Guåhan [The Legislature] to ensure that the projects enumerated in § 221404 of this Article are completed. In this respect, a written request shall be submitted to I Liheslaturan Guåhan [The Legislature], which may authorize and allow the transfer of funds between projects co ntained in § 221404 of this Article. § 221408. Bond Interest. Interest earned on the bonds authorized by this Ar ticle shall be used exclusively for the purposes of financing t he projects enumerated in § 221404 of this Article. § 221409. Legislative Approval Required. All terms and agreements to be entered into pursua nt to this Article shall be subject to legislative approval. § 221410. Same. The locations of the two (2) public high schools, o ne (1) public middle school, and two (2) public elementary schools, which are to be

ticle shall be subject to legislative approval. § 221410. Same. The locations of the two (2) public high schools, o ne (1) public middle school, and two (2) public elementary schools, which are to be constructed and financed pursuant t o this Article, shall be determined by the Guam Education Policy Bo ard pursuant to the priorities established in the Ten-Year Capit al Facilities Plan of the Department of Education. In addition, the G uam Education Policy Board shall outsource the building and groun ds maintenance, custodial, and food services of the ne wly constructed schools that are funded by this Article . 2009 NOTE: P.L. 28-045:10 (June 6, 2005) changed the name of the Department of Education to the Guam Public School S ystem. P.L. 30- 050:2 (July 14, 2009) reverted the name of the Guam Public School System to the Department of Education. § 221411. GMHA Board Action. The Guam Memorial Hospital Authority Board of Trus tees, through a board resolution, shall determine the det ails of the COL4/6/20225 GCA GOVERNMENT OPERATIONS CH. 22 GENERAL FISCAL POLICIES AND CONTROLS 227 establishment of an endoscopy suite, and the detail s of the redesign and expansion of the emergency

ails of the COL4/6/20225 GCA GOVERNMENT OPERATIONS CH. 22 GENERAL FISCAL POLICIES AND CONTROLS 227 establishment of an endoscopy suite, and the detail s of the redesign and expansion of the emergency medical dep artment and the replacement of the CT Scan System. § 221412. DPHSS Action. The Department of Public Health and Social Service s Director and the Board of Trustees for the Regional Community Health Centers, through a board resolution, shall d etermine the details of the expansion or the construction of new regional community health clinics. § 221413. Creation of the ‘Capital Infrastructure a nd Maintenance Fund’. There is hereby established, separate and apart fr om other funds of the government of Guam, a fund known as th e ‘Capital Infrastructure and Maintenance Fund’ (hereinafter ‘ Fund’). The Fund shall not be commingled with the General Fund or any other fund of the government of Guam. The Fund shall be held in an account or accounts at a Guam financial institution or institutions separate and apart from all other accounts and fund s of the government of Guam. The Fund shall not be subject to I Maga’lahi’s transfer authority.

nts at a Guam financial institution or institutions separate and apart from all other accounts and fund s of the government of Guam. The Fund shall not be subject to I Maga’lahi’s transfer authority. All proceeds of th e Compact Impact Grant Anticipation Bonds shall be deposited into this Fund and are hereby appropriated for the purposes of fin ancing the projects enumerated in § 221404 of this Article. --------- ARTICLE 15 INDIRECT COST FUND SOURCE : This entire Article was enacted by P.L. 29-113: VI:62 (Sept. 30, 2008). § 221501. Indirect Cost Fund Creation. § 221502. Separate Fund and Bank Account. § 221503. Purpose. § 221504. Deposits and Expenditures. § 221505. Administration. COL4/6/20225 GCA GOVERNMENT OPERATIONS CH. 22 GENERAL FISCAL POLICIES AND CONTROLS 228 § 221501. Creation. There is hereby created, separate and apart from ot her funds of the government of Guam, a fund known as the 'Ind irect Cost Fund'. § 221502. Separate Fund and Bank Account. The Indirect Cost Fund shall not be commingled with the General Fund or any other fund of the government of Guam. The Indirect Cost Fund shall be maintained in a separat e bank account. § 221503. Purpose.

ndirect Cost Fund shall not be commingled with the General Fund or any other fund of the government of Guam. The Indirect Cost Fund shall be maintained in a separat e bank account. § 221503. Purpose. The Indirect Cost Account shall be expended by appropriation by law for the following purposes: (a) Training such as Continuing Professional Education Credits, CPE. (b) Negotiating and Administering the government of Guam’s indirect cost rate. (c) Purchasing of Supplies and Equipment associated with Negotiating and Administering the government o f Guam’s indirect cost rate. (d) Automated budget development and maintenance. (e) General Operations for the agencies stipulated in § 221504, Article 15, Chapter 22 of Title 5. SOURCE : Added by P.L. 29-113:VI:62 (Sept. 30, 2008).Amend ed by P.L. 30-055:XII:1 (Sept. 4, 2009), P.L. 30-196:XII: 1 (Sept. 1, 2010). § 221504. Deposits and Expenditures. Deposits shall be made into the Indirect Cost Accou nt from Federal Reimbursement, for Executive Line Agency Cl aims or Claims on Indirect Cost not to exceed five percent (5%) of the total program monies based on a negotiated and appr oved Indirect Cost Rate from U.S.

eimbursement, for Executive Line Agency Cl aims or Claims on Indirect Cost not to exceed five percent (5%) of the total program monies based on a negotiated and appr oved Indirect Cost Rate from U.S. Department of Interior to be ap plied in administering Federal Programs. Monies deposited in the Indirect Cost Account shall be expended for the following ag encies: (a) Department of Administration; (b) Bureau of Budget & Management Research; COL4/6/20225 GCA GOVERNMENT OPERATIONS CH. 22 GENERAL FISCAL POLICIES AND CONTROLS 229 (c) Office of Public Accountability; (d) Guam State Clearinghouse. (e) Guam Department of Education SOURCE : Amended by P.L. 30-055:XII:1 (Sept. 4, 2009), P. L. 30- 196:XII:1 (Sept. 1, 2010). 2009 NOTE : Reference to Office of Public Auditor changed to Office of Public Accountability pursuant to P.L. 30-027:2 (Ju ne 16, 2009). § 221505. Administration. The Director of Administration shall account for an d administer the Indirect Cost Fund. The Director sh all keep all books, records, files and accounts of the Indirect Cost Fund. The Director shall prepare monthly reports relative to the Indirect Cost Fund reflecting the transactions and the financial condition

all books, records, files and accounts of the Indirect Cost Fund. The Director shall prepare monthly reports relative to the Indirect Cost Fund reflecting the transactions and the financial condition of the Indirect Cost Fund, which monthly reports shall be transmitted to I Liheslatura and I Maga’lahen Guåhan . ----------- ARTICLE 16 SUPPLEMENTAL APPROPRIATIONS REVENUE FUND SOURCE: Entire Article added by P.L. 31-074:II:2(b) (June 6, 2011). § 221601. Creation. § 221602. Separate Fund and Bank Account. § 221603. Purpose. § 221604. Administration of SAR Fund. § 221605. Annual Audit. § 221601. Creation. There is hereby created, separate and apart from al l other funds of the government of Guam, a fund known as th e Supplemental Appropriations Revenue Fund (SAR Fund) . § 221602. Separate Fund and Bank Account. The SAR Fund shall not be commingled with the Gener al Fund or any other funds of the government of Guam a nd shall be maintained in a separate bank account, administered by the COL4/6/20225 GCA GOVERNMENT OPERATIONS CH. 22 GENERAL FISCAL POLICIES AND CONTROLS 230 Director of the Department of Administration in acc ordance with this Article. § 221603. Purpose.

istered by the COL4/6/20225 GCA GOVERNMENT OPERATIONS CH. 22 GENERAL FISCAL POLICIES AND CONTROLS 230 Director of the Department of Administration in acc ordance with this Article. § 221603. Purpose. The SAR Fund shall act as a clearinghouse account f or all supplemental revenues and expenditures identified b y the government of Guam in any Supplemental Appropriatio ns Act and other Acts that contain revenue sources that ha ve not been identified in the General Appropriations Act of eac h fiscal year. § 221604. Administration of SAR Fund. The revenue sources identified in any Supplemental Appropriations Act and other Acts that identify new revenue sources that have not been identified in the Genera l Appropriations Act during each fiscal year shall be deposited or transferred into the SAR Fund and shall be expended exclusively for the purposes set forth by I Liheslaturan Guåhan in any Supplemental Appropriations Act or other Acts that identify new revenue sources during each fiscal year. The SAR Fund’s interest and investment earnings sh all be subject to legislative appropriation and shall be e xpended exclusively for the purposes set forth by I Liheslaturan Guåhan in any

scal year. The SAR Fund’s interest and investment earnings sh all be subject to legislative appropriation and shall be e xpended exclusively for the purposes set forth by I Liheslaturan Guåhan in any Supplemental Appropriations Act or other Acts t hat identify new revenue sources during each fiscal year. The SAR Fund shall not be subject to I Maga’lahen Guåhan’s transfer authority or any other law allowing use o r transfer of special funds. Revenues to and expendi tures from the SAR fund is restricted to only those authorized by I Liheslaturan Guåhan in this or subsequent Acts. § 221605. Annual Audit. The Office of Public Accountability shall perform a n annual audit of the SAR Fund and the compliance of the Dir ector of the Department of Administration with the expenditure o f such funds within the SAR Fund in accordance with the administ ration and exclusive purposes of this Article. Said audit sha ll include, but is not limited to, the revenues to the SAR Fund and th e expenditures from the SAR Fund. The OPA shall prepare and provid e a written report of compliance no later than seventy-five (75 ) days after the COL4/6/20225 GCA GOVERNMENT OPERATIONS CH.

d and th e expenditures from the SAR Fund. The OPA shall prepare and provid e a written report of compliance no later than seventy-five (75 ) days after the COL4/6/20225 GCA GOVERNMENT OPERATIONS CH. 22 GENERAL FISCAL POLICIES AND CONTROLS 231 end of the fiscal year to I Maga’lahen Guåhan and to the Speaker of I Liheslaturan Guåhan . ---------- ARTICLE 17 OPIOID PREVENTION AND TREATMENT ACT SOURCE: Entire Article added by P.L. 36-064:2 (Dec. 23, 2 021). § 221701. Title and Purpose. § 221702. Opioid Recovery Trust Fund. § 221703. Eligible Expenditures. § 221704. Opioid Recovery Advisory Council. § 221705. Reporting Requirements. § 221706. Designation of OAG as Single Agency. § 221707. Annual Audit. § 221708. Submission of Spending Plan. § 221701. Title and Purpose. This Act shall be known as the ' Opioid Prevention and Treatment Act .' The purpose of this Act is to provide for the us e of dedicated revenue for treatment and prevention o f opioid use disorder and co-occurring disorders. § 221702. Opioid Recovery Trust Fund. (a) There is hereby created the Opioid Recovery Tru st Fund (Fund), which shall be maintained separate and apar t from any other funds of the Government of Guam,

§ 221702. Opioid Recovery Trust Fund. (a) There is hereby created the Opioid Recovery Tru st Fund (Fund), which shall be maintained separate and apar t from any other funds of the Government of Guam, including th e General Fund. The Fund shall be a continuing fund; amounts credited to the Fund shall not be subject to further appropriat ion and monies remaining in the Fund at the end of a fiscal year s hall not be transferred to the General Fund. The Fund shall not be subject to any transfer authority of I Maga’hagan Guahan . (b) The Fund shall include all money, payments, or other things of value in the nature of civil damages or o ther payment, except criminal penalties, received on behalf of Gu am by the Office of the Attorney General (OAG) of Guam relati ng to the manufacturing, marketing, distributing, promoting, or dispensing of opioids, whether such is received by way of verd ict, judgment, compromise, or settlement in or out of court, of an y case or COL4/6/20225 GCA GOVERNMENT OPERATIONS CH. 22 GENERAL FISCAL POLICIES AND CONTROLS 232 controversy. The Fund shall also include any intere st earned on such amounts.

or out of court, of an y case or COL4/6/20225 GCA GOVERNMENT OPERATIONS CH. 22 GENERAL FISCAL POLICIES AND CONTROLS 232 controversy. The Fund shall also include any intere st earned on such amounts. (c) Monies in the Fund shall be used to supplement and not supplant or replace any other funds, including fede ral or local funding, which would otherwise have been expended f or substance use disorder prevention, treatment, recov ery or harm reduction services or programs. Further, general op erating funds or baseline funding shall not be reduced due to mon ies expended from the Fund. (d) The Office of the Attorney General shall prompt ly remit all money, payments, or other things of value to th e Treasurer of Guam for credit to the Fund. (e) The Office of the Attorney General, in consulta tion with the Opioid Recovery Advisory Council established by this Act, shall administer the Fund. (f) In administering the Fund, the Office of the At torney General may establish internal accounts to segregat e funds received from different judgments or settlement agr eements to the extent that different judgments or settlement agree ments direct specific allocation of expenditures. § 221703.

to segregat e funds received from different judgments or settlement agr eements to the extent that different judgments or settlement agree ments direct specific allocation of expenditures. § 221703. Eligible Expenditures. (a) Monies in the Fund shall be expended to mitigat e the impacts of the opioid epidemic on Guam, including, but not limited to, expanding access to opioid use disorder prevention, intervention, treatment, and recovery options. Moni es in the Fund may be expended to support reasonable costs associa ted with the administration of the Fund, including to offset the costs of legal and administrative burdens imposed upon the Attorne y General's Office, which shall not exceed ten percent (10%) of the total annual deposits into the Fund. (b) Any funds appropriated, expended, or distribute d from the Opioid Recovery Trust Fund shall be spent in ac cordance with the terms of any verdict, judgment, compromise, or settlement in or out of court, of any case or controversy brought pursuant to the Deceptive Trade Practices - Consumer Protection Act or any other law relating to the manufacturing, marketing, distr ibuting, COL4/6/20225 GCA GOVERNMENT OPERATIONS CH.

oversy brought pursuant to the Deceptive Trade Practices - Consumer Protection Act or any other law relating to the manufacturing, marketing, distr ibuting, COL4/6/20225 GCA GOVERNMENT OPERATIONS CH. 22 GENERAL FISCAL POLICIES AND CONTROLS 233 promoting, or dispensing of opioids. § 221704. Opioid Recovery Advisory Council. (a) There shall be an Opioid Recovery Advisory Coun cil (Council) established to determine the allocation o r expenditures of the Fund. (b) The Council shall consist of the following elev en (11) members, which shall include nine (9) voting member s, one (1) non-voting member, and one (1) non-voting member ch airperson: (1) the Attorney General, or designee, shall serve as the non-voting chairperson; (2) the Director, or designee, of the Guam Behavior al Health and Wellness Center; (3) the Director, or designee, of the Department of Public Health and Social Services; (4) the Administrator of the Courts, or designee, o f the Judiciary of Guam, who shall serve as a non-voting member; (5) the Administrator, or designee, of the Guam Memorial Hospital Authority; (6) one (1) member appointed by I Maga’hagan Guahan , who is qualified by experience with opioid use

a non-voting member; (5) the Administrator, or designee, of the Guam Memorial Hospital Authority; (6) one (1) member appointed by I Maga’hagan Guahan , who is qualified by experience with opioid use disorder, either first-hand or as a family member o f an individual with opioid use disorder; (7) one (1) member appointed by I Maga’hagan Guahan , who is qualified by experience with working as or with direct service providers or non-profit organiz ations; (8) one (1) member appointed by the Speaker of I Liheslaturan Guahan ; (9) one (1) member appointed by the Minority Leader of I Liheslaturan Guahan ; (10) one (1) member appointed by the Mayors Council of Guam, who is qualified by experience with opioid use disorder, either first-hand or as a family member o f an individual with opioid use disorder; and COL4/6/20225 GCA GOVERNMENT OPERATIONS CH. 22 GENERAL FISCAL POLICIES AND CONTROLS 234 (11) the Executive Director, or designee, of the Pu blic Defender Service Corporation. (c) In making appointments, appointing authorities shall consider having racially and socioeconomically dive rse representation on the Council. (d) A majority of voting members shall constitute a quorum.

In making appointments, appointing authorities shall consider having racially and socioeconomically dive rse representation on the Council. (d) A majority of voting members shall constitute a quorum. Determinations shall be made upon a majority vote. (e) The Council shall hold no fewer than two (2) me etings annually, subject to the provisions of 5 GCA Chapte r 8 - the Open Government Law of Guam. (f) Council members shall serve for terms of three (3) years, and any member shall be eligible for reappointment. In the event of a vacancy, the original appointing authority sha ll appoint a new member to fulfill the remainder of the unexpired te rm. Any member who is appointed may be removed by the appoi nting authority upon written notice to the chairperson. (g) Council members shall serve without compensatio n. (h) In making determinations for expenditures of th e Fund, Council members shall consider programs, including, but not limited to, those: (1) to prevent substance use disorders through an evidence-based youth-focused public health educatio n and prevention campaign, including school-based prevent ion and health care services and programs to reduce the ris k of substance use

through an evidence-based youth-focused public health educatio n and prevention campaign, including school-based prevent ion and health care services and programs to reduce the ris k of substance use by school-aged children; (2) to develop and implement public education campaigns to reduce stigma against individuals with a substance use disorder, provide information about t he risks of substance use, best practices for addressing sub stance use disorders, and information on how to locate service s that reduce the adverse health consequences associated w ith substance use disorders or provide treatment for su bstance use disorders; (3) to provide substance use disorder treatment and early recovery programs for youth and adults, with an emp hasis on COL4/6/20225 GCA GOVERNMENT OPERATIONS CH. 22 GENERAL FISCAL POLICIES AND CONTROLS 235 programs that provide a continuum of care that incl udes screening and assessment for substance use disorder s and co- occurring disorders, active treatment, family invol vement, case management, relapse management for substance u se and other co-occurring behavioral health disorders, voc ational services, literacy services, parenting classes, fam ily

nt, family invol vement, case management, relapse management for substance u se and other co-occurring behavioral health disorders, voc ational services, literacy services, parenting classes, fam ily therapy and counseling services, crisis services, recovery services, evidence-based treatments, medication-assisted trea tments, including medication assisted treatment provided in correctional facilities, psychiatric medication, psychotherapy, and transitional services programs; (4) to provide harm reduction counseling and servic es to reduce the adverse health consequences associated w ith substance use disorders, including overdose prevent ion and prevention of communicable diseases related to subs tance use, provided by a substance use disorder service p rovider or qualified community-based organization; (5) to provide housing services for people who are recovering from a substance use disorder. Such hous ing services shall be appropriate, based on the individ ual's current need and stage of recovery. Such housing se rvices may include, but are not limited to, supportive hou sing services; (6) to support community-based or diversion program s that reduce the likelihood of criminal

age of recovery. Such housing se rvices may include, but are not limited to, supportive hou sing services; (6) to support community-based or diversion program s that reduce the likelihood of criminal justice invo lvement for individuals who have or are at risk of having a sub stance use disorder; (7) to provide programs for pregnant women and new parents who currently or formerly have had a substa nce use disorder, and newborns with neonatal abstinence syn drome; and (8) to provide vocational and educational training for individuals with, or at risk for, a substance use d isorder. § 221705. Reporting Requirements. Annually, no later than October 31, the Office of t he Attorney General shall submit a report on the activity, reve nue, and COL4/6/20225 GCA GOVERNMENT OPERATIONS CH. 22 GENERAL FISCAL POLICIES AND CONTROLS 236 expenditures to and from the Fund to I Maga’hagan Guahan and the Speaker of I Liheslaturan Guahan. The report shall also be posted on the OAG website. The report shall include , but not be limited to: (a) the revenue credited to the Fund; (b) the amount of expenditures attributable to the administrative costs of administering the Fund, inc luding administrative

all include , but not be limited to: (a) the revenue credited to the Fund; (b) the amount of expenditures attributable to the administrative costs of administering the Fund, inc luding administrative support to the OAG and the Council; (c) an itemized list of expenditures; and (d) data and an assessment of the effectiveness of activities funded. § 221706. Designation of OAG as Single Agency. The Office of the Attorney General is designated as the single agency for Guam relative to bringing claims against entities for manufacturing, marketing, distributing, promoting, or dispensing of opioids pursuant to Guam law, including, but not limited to, the Deceptive Trade Practices - Consumer Protection Act . § 221707. Annual Audit. The Office of Public Accountability (OPA) shall per form an annual audit of the Opioid Recovery Trust Fund and the compliance of the Opioid Recovery Advisory Council with the expenditure of such funds within the Fund in accord ance with the administration and exclusive purposes of this Artic le. Said audit shall include, but is not limited to, the revenues of the Fund and the expenditures from the Fund.

the Fund in accord ance with the administration and exclusive purposes of this Artic le. Said audit shall include, but is not limited to, the revenues of the Fund and the expenditures from the Fund. The OPA shall prepa re and provide a written report of compliance to I Maga’hagan Guahan and the Speaker of I Liheslaturan Guahan no later than seventy- five (75) days after the end of the fiscal year. § 221708. Submission of Spending Plan. The Opioid Recovery Advisory Council shall submit a detailed spending plan for the Opioid Recovery Trus t Fund for Fiscal Years 2022 and 2023, to the Speaker of I Liheslaturan Guahan no later than August 1, 2022. The Opioid Recovery Advisory Council shall submit annually, a detailed spending plan for the Opioid Recovery Trust Fund for every subseq uent fiscal COL4/6/20225 GCA GOVERNMENT OPERATIONS CH. 22 GENERAL FISCAL POLICIES AND CONTROLS 237 year to the Speaker of I Liheslaturan Guahan no later than August 1st of each year. ---------- COL4/6/2022