CUC to Babauta: All we need is money

The Commonwealth Utilities Corp. has declined the governor’s joint effort proposal to address all of CUC’s problems within four years and instead urged Gov. Juan N. Babauta to discuss how the administration can help the utility firm financially.

“All the corporation needs is money. Understandably, that remains a most difficult proposition during these times. We ask again, as we have asked before, for the administration’s assistance and commitment to discuss funding schemes to help CUC get the money for those which plans already exist,” CUC chair Francisco Q. Guerrero told Babauta in a letter.

The governor had asked CUC to develop a CUC restructuring plan, with the help of the administration and the Attorney General’s Office. The objective, he had said, is to solve all of the CNMI’s utility-related problems within a 48-month period.

Babauta had identified CUC’s problems as the collapse of the wastewater collection system, rising fuel costs, need for rate re-structuring, pending regulatory issues and dangers to the environment, problems with power supply and transmission, and the lack of reliable potable water.

But while the CUC board members agree with Babauta’s objectives, they do not approve of the proposal to establish an ad hoc committee or task force, according to Guerrero.

He said CUC is well aware of its problems and has made efforts to address them. He cited CUC’s move to commission a study on power rates and a master plan on wastewater services. CUC has also tried to adopt a fuel surcharge regulation, he added.

“In the board’s view, a cooperative and concerted commitment to the identification of funding sources is the single most important factor that will determine whether or not CUC can fix the problems before the corporation,” Guerrero said.

One example, he said, is the construction of the Agingan wastewater ocean outfall.

CUC has been CUC has been under U.S. Environmental Protection Agency citation since 2002 because of CUC’s failure to complete the project. CUC cannot move ahead with the project due to lack of funding.

Guerrero said many other projects in power generation and wastewater treatment require millions of dollars in funds.

Aside from providing money for such projects, the CNMI government could also help by paying its over $10 million debt to CUC, Guerrero said. “This receivable is crippling the corporation’s ability to operate,” he said.

There is pending litigation involving the government’s alleged debt to CUC. The government has disputed CUC’s billing process and accused the utility firm of overcharging.

“We have no doubt the Legislature and your administration are sympathetic to CUC’s situation, even with the current financial situation of the central government. But solutions to CUC’s woes require money at every single step,” Guerrero reiterated.