Power bills remain on the balance

In an apparent attempt to be rid of an issue that could affect their chances in the November elections, lawmakers took turns yesterday pushing their own proposals on how to solve the fuel surcharge fee problem.

Of at least five pending fuel surcharge-related measures, the House of Representatives approved one, defeated a veto override, and passed one on first reading.

The House passed on first reading House Bill 14-362, authored by Vice Speaker Timothy P. Villagomez, which aims to increase CUC’s electricity rates, repeal the fuel surcharge, and defer the $45 million outstanding loan of CUC with the Commonwealth Development Authority.

The bill failed to hurdle final reading because it requires further discussions on major areas such as the fuel surcharge repeal and CDA loans.

Meantime, House Bill 14-366, authored by minority bloc leader Arnold I. Palacios, remains on the balance. Palacios’ bill aims to offer a fuel surcharge subsidy of $70 for each household in the CNMI. It is based on a 2,000 kilowatt usage of a family of four per month.

To do this, Palacios proposes to raise the poker licensure fee by $4,000 per machine, increasing the $6,000 annual poker fee to $10,000. There are 1,500 poker machines on Saipan and Rota, which would generate a new revenue stream totaling nearly $6 million.

He said that based on CUC data, residential users’ fuel surcharge fee total about $4.7 million to $4.9 million, which reflects 35 percent of the entire fuel surcharge collection.

“If we pass this bill, it’s quick relief to our residents. All households will benefit from this up to 2,000 kilowatt hour. We’re getting fresh revenues to subsidize the fuel surcharge,” said Palacios.

Villagomez and Rep. Clyde Norita both challenged Palacios’ computation and revenue projection.

Villagomez said Palacios should not base his computation on the fixed 35 percent residential fuel surcharge figure but rather on actual kilowatt usage of customers.

Norita warned that revenues would not be realized if poker machines decide not to renew their licenses.

“Where would you get your funds if they [poker arcades] shut down?” asked Norita, noting that operators might no longer afford the increase.

Palacios said this was the opinion of the government several years back when it raised the poker licensure fee to $6,000 but, instead of closing down, more poker shops sprouted all over the islands.

“That’s what we hoped but still the number had increased,” he said, pointing out that there are over 1,000 poker machines on Saipan alone, from 900 machines a few years ago.

He said that, in a worst-case scenario—where 500 operators will shut down—the remaining shops would still generate $4 million.

“It’s still substantial,” he said.

House Speaker Benigno R. Fitial asked Palacios if he had consulted poker operators on his bill but the lawmaker said the industry’s position is already predictable.

“They would oppose this. There’s no way they would support this,” he said.

“Maybe we could ask them if they will continue to do business here if the bill is passed…” suggested Fitial.

“I already know the answer to that. I anticipate they would say no,” said Palacios.

Fitial then called for a recess until Monday.

Palacios said he would move that his bill be tackled first in Monday’s session.

“I am willing to wait. This measure provides direct subsidy to the people,” he said.

Under the bill, the secretary of the Department of Finance shall deposit the additional revenues ($4,000 per machine) in a separate account in the general fund known as the “Fuel Surcharge Fee Fund.”

This money shall be transferred to CUC, which shall then credit it to CUC residential customers who use less than 2001 kilowatt hour a month.

The bill aims to waive the additional fee for machines operated within the casino premises, which is subject to the Tinian Casino and Gaming Control Commission.

Palacios’ bill also aims to impose a lump sum payment of poker license fees rather than on a quarterly basis, as is presently being done.

Meantime, another measure—House Bill 14-365—which is authored by Rep. Jesus Attao, aims to earmark .5 percent of the taxes collected from income taxes, excise taxes, miscellaneous taxes and license fees, amusement machine taxes, business license fees, charges for services and revenues for the fuel surcharge. The bill has not been set for discussion.

Yesterday, the House approved a $10-million appropriation bill that would be used to reimburse people for their fuel surcharge in fiscal year 2005.

The measure, House Bill 14-360, was authored by Rep. David Apatang.

A motion to override the governor’s veto of Villagomez’s bill that aims to repeal the existing fuel surcharge fee was defeated during yesterday’s session.

H.B. 14-343 received only 10 “yes” votes for the override, which is two votes short of the needed three fourths affirmative approval.