Saipan Tribune

Sunday, May 26, 2013

Thursday, January 03, 2013

FOLLOWING SAN NICOLAS' OPINION

Fitial agrees: PPA deal void

Following Attorney General Joey P. San Nicolas' opinion on the controversial no-bid $190.8-million power purchase agreement, Gov. Benigno R. Fitial now agrees that the deal is void and unenforceable, according to press secretary Angel A. Demapan.

This developed as San Nicolas' opinion drew negative reactions from some lawmakers and concerned citizen Glen Hunter.

Demapan told Saipan Tribune that Fitial concurs with the opinion issued Monday by San Nicolas, who found that the prior position of the Office of the Attorney General that the contract was proper was erroneous.

Furthermore, Demapan said, Fitial recognizes that San Nicolas' latest position will allow for a full examination of the merits of the proposal and the need to address the long-term power needs of the Commonwealth.

“There are no arguments that the current power generation system is costly and reaching the end of its life expectancy. It is still important for the Commonwealth to find alternatives in pursuit of lowering utility costs and attracting new industries to the CNMI,” Demapan said.

In his opinion, San Nicolas declared that Fitial is not liable for any cause of action related to his signing of the power purchase agreement with the Delaware-based Saipan Development LLC.

San Nicolas said that Fitial cannot be blamed because he reasonably relied on the certification of then attorney general Edward T. Buckingham that the power purchase agreement was “proper as to form and capacity.”

San Nicolas, however, determined that Fitial did not have the authority, pursuant to Executive Order 2012-17, to enter into the power purchase agreement with Saipan Development LLC.

Sen. Ralph Torres (R-Saipan) said yesterday that, since San Nicolas has already ruled that the governor does not have the authority to sign the power purchase agreement, then he believes that the contract is already deemed null and void.

With San Nicolas' opinion, Torres said it is more important for the CNMI to bring back Buckingham to clarify exactly what transpired in the contract signing.

“My concern is how was this contract formulated? How was it consummated? Because we don't want to set the wrong precedent for the next administration or the following administration,” he said.

The senator pointed out that for any government contract of such magnitude or even above $1 million, there should be at least a public hearing or public notice on what's going on.

“I also advise the other departments whether they are autonomous or not that they have to hold public hearings and be open to the public,” he added.

Attorney Ramon K. Quichocho said that if it is true that Fitial merely relied on a mistaken opinion by Buckingham, then the governor must now take steps to cancel the power purchase agreement and its related agreements-particularly since he is now getting competent advice from San Nicolas.

“Intentional blind reliance on a mistaken opinion by an attorney, as in the case here, is clearly not the type of reliance that the AG opinion addresses,” said Quichocho on behalf of his clients, Reps. Janet Maratita (IR-Saipan) and Ray Yumul (IR-Saipan) and the Senate. The three are suing Fitial to invalidate the power deal.

Incoming House Vice Speaker Rep. Frank Dela Cruz (IR-Saipan) said he does not believe that Fitial is not liable for signing the power purchase agreement.

“I believe that the governor is well aware of what this type of contract entails. It entails a lot of financial resources from the CNMI government,” Dela Cruz said.

The lawmaker strongly feels that this would become a public debt.

Concerned citizen Hunter said what appears to be incorrectly implied by San Nicolas' opinion is that Fitial should sign off on any and all contracts simply because the AG gives him the okay that they are proper as to form and capacity.

“That is not and should not be the case. Simply stating that the governor can legally sign a document does not in any way alleviate Fitial of his responsibility as the governor to make sound and rational decision as to whether he should sign off on them,” Hunter said.

Hunter said that San Nicolas' opinion “appears to be a feeble attempt” by the new AG to alter the focus of public concerns with the Saipan Development LLC deal “in order to make Fitial out to be nothing more than an ignorant victim.”

“That is not the case at all and I don't think the public is that blind and dumb,” he said.

Hunter said it is very clear that the Saipan Development LLC deal is not good for the CNMI.

“The person directly responsible for its existence is Fitial and he should be held accountable. The people deserve a full investigation into the true motives behind the execution of this secretive deal,” he added.