Customers Owe $32 Million To CNMI Utilities Corporation

admin's picture

Hospital, school system and government have highest bill

By Moneth Deposa

SAIPAN, CNMI (Saipan Tribune, Sept. 12, 2012) – The cash-strapped Commonwealth Utilities Corp. (CUC) of the Northern Mariana Islands disclosed yesterday that it has $32 million in receivables owed by customers as of Aug. 31, 2012.

The biggest unpaid obligation is by the government and its instrumentalities at $12.396 million. Records show that $1.4 million is current, which means the bill is 0-15 days old; $3.4 million is 16-75 days old; and $7.4 million is 75 days old and beyond.

The bulk of the government's arrears were incurred by CUC's three biggest customers: the hospital, public schools, and the central government itself, according to CUC chief financial officer Charles Warren.

It was learned that the Commonwealth Healthcare Corp. (CHC) owes CUC $4.1 million as of Aug. 31, not including late fees, while the Public School System (PSS) has unpaid obligations of $3.1 million. The central government, meanwhile, has a debt of $2.4 million.

Besides the government and its departments, many residential customers also owe CUC a total of $11.5 million. It is composed of $350,989 for current bills; $1.6 million for 16-75 days old accounts; and $9.5 million for 75 days old and beyond.

Warren said the 75 days old account is primarily composed of very old balances that need to be written off, disputed accounts that CUC is currently working to resolve, and long-term payment agreements.

Commercial customers also owe CUC $8 million as of Aug. 31. Of that amount, $1.6 million is current; $1.3 million is 16-75 days old; and $5 million is over 75 days old and primarily composed of very old balances, some over 10 years old, and disputed accounts being worked out by CUC.

Warren said that CUC is working on several billing disputes to improve the agency's collections. He disclosed that CUC's average monthly collection this fiscal year is $7.825 million.

"Other than billing disputes, the majority of residential and commercial customers are relatively current. We have added staff to more quickly address the billing disputes. As a result, the over 75-day balance for residential accounts has decreased by about $2 million since Sept. 30, 2011," Warren said.

On the other hand, he noted that receivables from government accounts continue to grow, especially for PSS and CHC.

Education Commissioner Rita A. Sablan, Ph.D., said yesterday that CUC is among its biggest expenditures every year. Despite the austerity measures and energy conservation plans in place, obligations continue to grow as a result of increasing power and water rates. Sablan admitted that due to budget constraints, the obligation to CUC may not be immediately addressed.

Like PSS, the healthcare corporation is also struggling to find monies for its operation, including payment for its utility consumption. The corporation is also in state of emergency due to the lack of funds to hire needed personnel and immediate supplies for the public hospital.

Rate this article: 
No votes yet

Add new comment