(a) For the purpose of facilitating the refinancing of the design, construction and maintenance of an existing Education Facility or existing Education Facilities encompassed by this Act, the government of Guam or an Education Agency, as the case may be, is authorized to lease under existing contracts and/or existing amendments thereto, if required, to the Contractor, subject to legislative approval, sufficient government of Guam real property, to include, but not be limited to, Chamorro Land Trust Commission property and Guam Ancestral Lands Commission property, on which to construct, convert or rehabilitate an Education Facility; provided, such property is in the inventory of the Education Agency. The location of the property may be at the site of an existing Education Facility under the control of an Education Agency, which may be converted, rehabilitated or demolished and rebuilt under the provisions of this Act.

(b) Any lease of property pursuant to this Act will be for a period mutually agreed upon between the Education Agency and the Contractor as may be reasonably necessary to amortize over the Lease-Back period of the Contract, the costs associated with the financing, design, construction and maintenance of the Education Facility, and in no event shall such period exceed thirty (30) years from the date of commencement of the Lease-Back period; and provided further, that with respect to leases of property for the sole purpose of refinancing the prior design, construction and maintenance of an existing Education Facility or existing Education Facilities:

(1) any leases and/or amendments to such leases entered into for such purposes shall not extend the original Lease-Back period relating to such prior design, construction and maintenance of an existing Education Facility or existing Education Facilities of any original leases applied to finance such prior design, construction and maintenance of an existing Education Facility or existing Education Facilities;

(2) with respect to any existing leases and/or existing amendments to leases that have the effect of refinancing the government’s obligations with respect to the Guam Education Financing Foundation Certificates of Participation Series 2006 and
2008 (2006 and 2008 Certificates), all obligations of the government to pay debt service with respect to the 2006 and 2008

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Certificates being refinanced shall be discharged concurrently with the execution of the leases and/or amendments to leases entered into for such refinancing purpose, and thereafter any remaining debt service on the refunded 2006 and 2008 Certificates shall be payable solely from and secured solely by a refunding escrow established for such purpose;

(3) the present value in the aggregate of debt service with respect to the government’s obligations with respect to such new leases or amendments to leases shall be at least two percent (2%) less than the present value in the aggregate of debt service on the refunded 2006 and 2008 Certificates, using the yield on the refunding bonds as the discount rate; and

(4) no increase in the amount of outstanding “”public indebtedness”” as that term is used in 48 USC 1423a (§11 of the Organic Act of Guam) shall result from the execution of any such existing leases and/or existing amendments to leases.

(c) The Contractor shall lease back to the Education Agency the property for the Lease-Back period. Upon the expiration of the Lease and the Lease-Back periods and the fulfillment of the terms and conditions of the Lease-Back by the Education Agency, the property and the existing Education Facility or existing Education Facilities shall become the property of the Education Agency, and the Contractor shall have no further right, title or interest in the property or the existing Education Facility or existing Education Facilities.

SOURCE: Added by P.L. 26-061:2 (Dec. 22, 2001), amended by P.L. 28-047:3 (June 10, 2005), P.L. 29-069:3 (Apr. 29, 2008), P.L. 33-094:2 (Nov. 9, 2015), and P.L. 33-118:1 (Feb. 3, 2016).

2016 NOTE: Subsection designations were added to adhere to the Compiler’s alpha-numeric scheme in accordance with the authority granted by 1 Guam Code Ann. § 1606.