Senate to look into IG report on sole-source ARRA contract

The Senate is finally looking into the Inspector General report on the privatization of the management of CNMI ARRA funds after Senate President Paul A. Manglona (R-Saipan) instructed one its committees to investigate the matter.

In a memorandum dated yesterday, Manglona referred the IG report to the Senate Committee on Executive Appointments and Government Investigations for review.

“This is a very important issue and I ask your committee to give its full attention to this issue,” Manglona told committee chair Francisco Q. Cruz (R-Tinian) in the memo.

In an interview with Saipan Tribune, Manglona said he has given Cruz and his committee 30 days to submit a recommendation on the IG report.

“The committee is planning to hold a hearing on Wednesday next week,” he said, adding that he expects Cruz to call the personalities involved in the controversial $392,404 sole-source contract to former Commerce secretary Michael Ada’s firm, Integrated Professional Services.

As this developed, The New York Times ran an article on Monday that reported on the IG report.

Written by Emily Yehle of Greenwire, “Islands deal with former Commerce secretary’s company violated rules” says: “Government officials in the Northern Mariana Islands violated ethics rules after they handed an almost $400,000 contract to the former Commerce secretary’s new company, according to Department of Interior’s inspector general.”

Delegate Gregorio Kilili C. Sablan, meanwhile, told Pacific News Center that some $64 million in ARRA funds that have yet to be issued to the Commonwealth could be in jeopardy after the IG’s report that IPS’ sole-source contract may have violated CNMI procurement rules and ethics regulations.

Sablan said he’ll fight to prevent ARRA funds from being “cut off.”

“The people of the Commonwealth didn’t break the law, so they shouldn’t be punished. If anything, that contract, that money that has been paid out, should be returned to the Commonwealth government,” Sablan was quoted.

As of March 2011, the report said the CNMI has received $51 million out of the $115 million in ARRA funds awarded to the islands.

The report also quoted Sablan as saying that he plans to talk to U.S. Attorney Alicia Limtiaco and find out why her office is declining to prosecute the case.

“I haven’t had a chance to speak to the United States Attorney, to Ms. Limtiaco. I will try to speak to her. I will also try to speak to some people here, within the Department of Justice to find out what’s the reason for declining. She must have had her reasons. But, at the moment, I don’t know what her reasons are.”

The IG report, which was made available online Saturday in the Interior’s website, said, among other things, that the CNMI government’s sole-source contract with Ada’s IPS “is null and void if the procurement processes or execution fails to comply with CNMI Procurement and Supply Regulations.”

It said the evidence suggests that the Fitial administration’s contract to IPS violated multiple CNMI ethics rules, including provisions against post-employment restrictions, use of office, staff, or employees of public office, restraint on use of public position to obtain private benefit, and negotiating for nongovernment employment.