CNMI Administration Seeks Legislative Help To Pay Utility Bills

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Governor not commenting on CUC board, Executive Director

By Cherrie Anne E. Villahermosa

SAIPAN, CNMI (Marianas Variety, May 28, 2015) – The administration is not commenting on the contract of Commonwealth Utilities Corp. Executive Director Alan Fletcher or on the CUC board’s micro-managing the utility, but did say it is trying to get legislative help to pay what the government owes CUC.

[PIR editor’s note: Marianas Variety reported that ‘The Commonwealth Utilities Corp. board at a May 12, 2015 meeting tried to fire CUC Executive Director Alan Fletcher, but allowed him to "resign" after he said he would not renew his contact which ends in July, Variety learned. ... The board also wanted to hire IT&E engineering manager Velma Palacios as acting executive director, but was told that under the federal stipulated orders, the position requires at least 10 years of senior management experience in the area of electrical or water utilities. She has neither.’ MV also reported that ‘‘A day after [that] story broke, Commonwealth Utilities Corp. Board Chairwoman Adelina Roberto issued a statement "to clarify portions of the Marianas Variety news article, printed on Tuesday, May 26, 2015." ... She said "many portions of the article titled, ‘CUC board wants to hire…’ were inaccurate and relied on unofficial and unsubstantiated information. Any reporting outside of official channels is simply hearsay."’]

Yesterday, Press Secretary Ivan Blanco acknowledged that the budget for utilities has been underfunded for many years while also being the source of budget over-expenditures.

He said the utilities budget proposal for fiscal year 2016, which starts on Oct. 1, 2015, is based on the funding for utilities in FY 2015.

CUC said that the FY 2015 budget allowed for under-appropriation of central government utility payments.

According to Blanco, "An allocation of $12.7 million for FY ‘16 was made to defray utility consumption charges for the three branches. All branches are advised to strictly implement energy-saving measures necessary to reduce utility costs."

The proposed FY ‘16 budget has the following utility allocations: executive $6,447,739; legislative, $79,000; judiciary, $572,923; the Public School System, $3,600,000; and the Commonwealth Healthcare Corp., $2,000,000 for a total of $12,699,662.

The government’s debt to CUC is now over $30 million.

"We continue to seek the Legislature’s support to allocate more funding toward current obligations and incremental payments to settle old accounts with CUC in this FY ‘16 budget proposal or through supplemental appropriations," Blanco said.

The administration, he added, "continues to take steps to mitigate this situation. In the FY ‘16 budget proposal, $2 million was allocated for direct payment of outstanding utilities by the central government specifically for the Commonwealth Healthcare Corporation. We continue to enforce the separate provision restricting any funds from being reprogrammed from the utilities allocation similar to that of Public Law 18-66," referring to the FY 2015 budget act.

"It is the governor’s constitutional duty to maintain a balanced budget and critical activities were considered as part of the whole budget call process," Blanco added.

He did not comment on the measures enacted by the administration and Legislature that further reduce CUC’s revenue.

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