Federal investigators descend on Guam ....

What is hoping to be a major secret is now not so secret.



A team of investigators from the federal Inspector General's Office of the United States Department of Housing and Urban Development  arrived on Guam last week to investigate this controversial deal at GHURA involving the Calvos and Coretech (yes i know, them again).
Click this link for PNC story

According to the Pacific News Center: "The Guam Housing and Urban Renewal Authority board has approved the sale of Great Homes to Coretech in effect allowing the transfer of millions of dollars in federal Low Income Housing Tax Credits. Coretech previously bought out Tower 70 and took over their tax credits.



Coretech has bought out Great Homes and the GHURA board has approved the transfer of Low Income Housing Tax Credits to Coretech. In 2012 Great Homes was awarded over $2.9 million dollars in tax credits over ten years which amounts to over $29 million dollars in tax credits to build a total of 81 homes along Rt. 9 in Dededo near the Starts Guam golf resort.

"The terms and conditions of the award still remain in place. The number of units to be built still remain at 81. The completion date is still December 21st 2014 and all the other terms of the award remain in place as well,” explained GHURA Executive Director Mike Duenas.

Last year the GHURA board approved a similar deal in which Coretech bought out Tower 70 which is another company that was awarded tax credits to build affordable homes. Tower 70 was awarded over $2.8 million in tax credits or over $28 million over ten years.

The awarding of these tax credits to both Great Homes and Tower 70 has not been without some controversy. In fact, a company named Medallion and Carlos Camacho who is the Executive Director of the Micronesia Community Development Corporation both filed protests after the credits were awarded. GHURA's selection committee had originally picked Medallion as the number one ranked applicant for the tax credits and had ranked Camacho's two applications as number two and number three. Great Homes and Tower 70 were ranked as the number four and number five applicants respectively. However, the board disqualified Medallion and the number two and three ranked applicants and instead gave the tax credits to Great Homes which was owned by Catholic Social Services, Jones & Guerrero and the Calvo Finance Corporation and Tower 70 which was owned by Robert Salas and Keith Farrel.

In March of 2012 then GHURA Executive Director Marcel Camacho submitted his resignation citing "irregularities" with the awarding of these tax credits. Camacho also said he alerted the "proper authorities." Then in April of 2012 PNC reported that the FBI was looking into the matter and Camacho's replacement Ray Topasna had been questioned by the FBI. Topasna was later fired by the GHURA board and then replaced with the current Executive Director Mike Duenas. The GHURA board stated that Topasna's termination was unrelated to his handling of tax credits.

During a board meeting in November of 2012, GHURA Board Chairman Dave Sablan said that the protests were not followed up on and were effectively abandoned thus they moved forward with the awarding of tax credits and now the approval of the sale of these businesses and the tax credits to Coretech international and it's partnering non profit org called Guam Self Help Housing Corporation of which Tony Sgro is a board member.

The approval of the Great Homes sale did come with some conditions. For example a 30 year extended use period must be observed. "The extended use period basically says that they will rent the units to income eligible families for 30 years after the initial 15 year period,” explained Duenas.

This means they will have to lease out the units at affordable housing rates for a total of 45 years. Duenas says that the board concluded that allowing this sale would be in the best interest of the island but the approval is also subject to final legal review. "The Internal Revenue code is kind of complex so we are working with our lawyers to make sure the change is in conformance with the regulations,” said Duenas.

In fact the GHURA board has has had it's attorney's review all of it's decisions and has stood by all of it's decisions with regards to the awarding of these tax credits. Board Chairman Sablan has also defended all decisions of the board related to the Low Income Housing Tax Credits saying all of the decisions have been in accordance with IRS regulations. Coretech will now be building a total of 151 low income housing units by December of 2014."