‘Place CUC under receivership’

Rep. Tina Sablan has asked the U.S. Department of Justice and U.S. Environmental Protection Agency to push the U.S. District Court to appoint a receiver for the Commonwealth Utilities Corp.

The move is necessary because CUC’s problems are fundamental and systematic and cannot be resolved through conventional means, Sablan said.

“I think it’s about time that we said, ‘OK, this is really beyond the capacity of the local government to resolve on our own,’” she said. “And having a receiver who would be insulated from local politics and would be empowered under the close supervision of the court to do what is necessary and appropriate to bring CUC into compliance with these federal mandates and ultimately to improve these essential public services for the good of the CNMI.”

The request comes as the comment period regarding stipulations compelling CUC to adhere to federal regulations governing water, sewer, power and fuel ends.

In November, DOJ and EPA filed a lawsuit against CUC accompanied by the two stipulations, which CUC executive director Antonio Muña and Gov. Benigno Fitial signed off on. The original 30-day comment period ended Dec. 2, but a request was made to extend it for another 30 days. The latest comment period ended Jan. 31.

The representative said her major concern is whether CUC can realistically meet the provisions necessary under the stipulations. If they are not met, CUC can be penalized up to $1,000 per day per violation for the first 30 days; $2,000 per day per violation following the 30 days; and $5,000 per day per violation for each day after.

It should be noted, Sablan said, that the latest orders are not the first time enforcement action has been taken against the utility agency.

“Though progress has been made toward compliance with federal mandates and improvements in services, such progress has been limited and sporadic,” she said in her comments.

In July, when Fitial and Muña originally agreed to the orders, the governor said they had decided to tackle the issue head on.

“In the past people wanted to hide from bad news,” Fitial said. “We decided to fix the problem instead.”

Although the stipulations do not address Saipan’s ongoing power crisis, it would be counterproductive to separate the power issues from its water, wastewater and used oil issues, he said.

Muña, CUC’s executive director, had echoed this statement in the past. Without power, CUC cannot provide water or other basic necessities to the public

Sablan said she realizes the seriousness of her request for receivership.

“I make this request only after having carefully examined CUC’s nearly 22 years of mismanagement, planning failures, noncompliance with both federal and local mandates, fiscal abuse, political meddling, and neglect—and the public health and environmental catastrophes, both real and threatened, that have resulted,” she added. “It has become increasingly evident that CUC’s problems are beyond the capacity of existing management at CUC, and of the present political leadership, to effectively resolve on their own.”

Sablan noted that nearby Guam is also currently under a receivership.

Gershman, Brickner & Bratton, Inc. was appointed receiver to help the Guam government develop a sustainable waste management system after the government was unable to bring the Ordot dump into compliance with EPA regulations.