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CUC privatization bill hurdles House
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Posted on Jun 17 2008
The House of Representatives rushed to passage yesterday a bill requiring the Commonwealth Utilities Corp. to issue a privatization bid within 45 days of the bill becoming law.
The House voted 16-3 to approve the bill. Representatives Francisco Dela Cruz, Tina Sablan, and Edward Salas voted against the bill, and Rep. Justo Quitugua was absent.
The House-approved bill would allow CUC to sell its power system for at least $250 million, half the minimum value proposed in the original version of the bill. The bill calls for a bid process, a departure from the request-for-proposals procedure CUC had used in its previous privatization efforts.
The bill would also restore the CUC board of directors.
Rep. Victor Hocog, one of the bill’s proponents, said it is necessary to fast-track the privatization of CUC, as the utility is depleting government resources while failing to offer reliable and affordable service.
“[The] Commonwealth ratepayers deserve a utility that delivers high quality power on a 24/7 basis at reasonable prices, whose operations are open and transparent, whose books are balanced, whose audits are clean, and whose operations are reviewed by an independent regulator,” the bill states.
But while the bill got overwhelming support in the Lower House, a few members raised concern about its quick passage.
Sablan, one of the three lawmakers who voted against the bill, said the privatization of the power utility is too important to rush. She noted that the bill cleared the House without a formal review by the responsible House committee, without a public hearing, and without comments being solicited from concerned government agencies. She also expressed concern about the lack of documentation to support the $250-million price tag given the power plants.
“Previous efforts to privatize CUC failed primarily because they were rushed and involved a multitude of procurement irregularities. By rushing this bill, I feel we’re just repeating history,” she said.
Salas also said he supports the intent of the bill, but believes more study is needed.
The bill now heads to the Senate for action.
