Authorization to Enter into Long-Term Leases

(a)I Maga’hågan/Maga’låhen Guåhan may enter into a lease and lease-back on behalf of the Department for the financing of the acquisition, construction, improvement, equipping, repair, renewal, replacement, or reconstruction of any solid waste facility, together with operation and maintenance of all or any portion of such solid waste facility over the term of the lease-back, according to the needs of the Department and consistent with this Article.

(b)The costs of the construction and financing of a solid waste facility financed pursuant to this Article shall be amortized in periodic installments over the term of the lease-back period, which shall be mutually determined by I Maga’hågan/Maga’låhen Guåhan and the contractor, but which will not exceed forty

(40)years.

(1)The lease and lease-back may provide that if sufficient funds are not appropriated or otherwise available for the payment of such installments, the Department will have the obligation to vacate the solid waste facility, and the contractor shall have the right of use and occupancy of the solid waste facility for the remainder of the term of the lease, unless new mutually satisfactory terms are entered into. For this purpose, the lease may provide that its term shall be extended for a period not to exceed the shorter of ten

(10)years beyond the original term of the lease-back or such period of time as is necessary to repay in full any financing arranged pursuant to this Article.

(2)The Department shall pay the operation and maintenance costs of the solid waste facility on a periodic basis as incurred by the contractor on terms to be agreed to in the lease-back for each solid waste facility.

(c)It is hereby declared that the system and each solid waste facility is and shall be a public improvement or undertaking as that term is used in Section 11 of the Organic Act (§1423a, Title 48, U.S. Code). Obligations incurred by the government pursuant to this Article that are payable only from funds in the Solid Waste Operations Fund available therefor and from revenue of the system will not be and shall not be deemed to be public indebtedness of Guam as that term is used in said Section 11.

(d)No obligation undertaken by the government pursuant to this Article shall be or become a lien, charge or liability against the government of Guam or against the Department or against any property or funds of the government of Guam or the Department, except to the extent of the pledge of revenue of the system provided by the lease-back.