Airport Spent $317K On Services With No Written Details

More than $300,000 in Guam airport funds were paid to a Philippine consultant and the consultant's Hong Kong subcontractor in a deal apparently approved by the agency's former management - just four months before management left office, documents show.

Got A Receipt?

Payments to the consultant have been stopped because there are no documents that explain or justify the payments, said William Thompson, the new executive manager of the Guam airport agency. The authority wrote the consultant asking that he explain the services he provided the airport, but the request has not been answered.

Thompson said the airport's new management sent a note to a Philippine fax number from which the contractor had sent a bill to the airport agency, but received no response.

This Investigation Is Bound For Glory

The consulting contract identifies the main contractor as Glory Link Aviation Information and Consultancy, which lists its business address as 2811 Vergel St., Pasay City, Philippines, and Emigdio Reyes Jr. as its president.

A reporter went to the contractor's Philippine address, a small house in a crowded, ramshackle neighborhood. The home does not have a sign that identifies the address as an aviation consultant's place of business. Emigdio Reyes was not at the house when sought for comment, but someone who was at the house said Reyes does live there.

Low Profile

Glory Link is neither listed in the Philippines' largest phone book, nor does its name pop up in some of the Philippines' major business directories on the Internet.

The consulting contract was signed on Sept. 1, 2002, and committed the Guam airport agency to paying $24,000 per month to the main contractor and an additional $16,000 per month to its subcontractor.

The contract was to last two years - well beyond the tenure of then airport Executive Manager Gerald Yingling, who was appointed by Gov. Carl Gutierrez. Gutierrez's term ended when a new administration took office in early January.

By the time the airport agency had new management - just four months after the consulting contract's approval - the agency had paid $317,000 to the main contractor and to the subcontractor, according to an initial agency review of payments to consultants.

The consulting contract with the Philippine contractor was executed without the knowledge of the airport agency's board of directors at the time, Thompson said.

In addition to monthly fees, payments to the contractor and/or subcontractor included vaguely itemized payments of: $18,500 for a Philippine golf show; $25,000 for an airline-related promotional effort; and $60,000 for promotions geared toward the China travel market, according to airport records.

Thompson said the consulting contract with Glory Link, which has a subcontractor, Hong Kong-based China Link, was discovered as part of a routine review of the airport agency's contracts with consultants.

Saaaay... This Isn't Right

The contract with Glory Link stood out, he said, because there were no written details on what services were provided.

"We're not saying there's anything criminal, but it's odd and it sticks out,'' according to Thompson.

He added that the new airport management reviewed the agency's finances as part of efforts to identify areas where expenses can be cut.

The airport agency must show fiscal responsibility, not just because it's the prudent thing to do, but also because it is being monitored by credit rating agencies whose opinion will be key to the airport's attempt this year to refinance about $250 million in bond debt, Thompson said.

The Guam airport agency also is under constant monitoring by the Federal Aviation Administration because the airport receives millions of dollars in FAA grants almost every year. "We're not here to dig up dirt on the former management; We're just cleaning house here,'' Thompson said. "We want to show we are managing the airport in a prudent manner.''

Thompson said the agency had more than $6 million in losses last fiscal year. That year marked the beginning of the airport agency's big-ticket spending projects, including:

• The Birdman Rally gliding event, which had a price tag of $1.3 million; and
• The exhibit of ancient terra cotta warriors and other Chinese artifacts at a cost of $1 million and an additional $250,000 by the time the exhibit ends later this month.
  The airport agency's new management and board have halted $4.5 million worth of projects and consulting contracts approved during the previous administration, Thompson said.
• One of the projects on hold is the $2 million production of 12 bronze, life-size statues, 11 of which are in honor of former Guam governors. The statues are being made in South Korea and are in various stages of completion.
• A 12th bronze statue, that of former Congressman Antonio B. Won Pat, in whose honor the Guam international airport was named, is going through finishing touches, according to the airport agency.

FMI: www.airport.guam.net