Bill to cut water rates for farmers recalled • CUC says legislated utility rates infringes on agency’s autonomy

Deferring to the request of the Commonwealth Utilities Corporation, Rota Rep. Alejo M. Mendiola has recalled a proposed legislation setting new water rate for farmers on the island in favor of a resolution to ask CUC to implement the lower utility charges.

The proposed water rates are 25 cents per thousand gallons for the irrigation of farm land and 30 cents per thousand gallons for the watering of livestock that includes poultry, cattle, goats and pigs.

The move is intended to help local farmers deal with the rising costs of maintaining farm lands as well as in tending to vegetables and livestock for commercial production.

Pending before the House of Representatives since last year, Mendiola’s bill was junked after CUC Executive Director Timothy P. Villagomez cautioned lawmakers against legislating utility rates on the island.

Although the proposed rates would have no impact on its financial standing, the government-owned utility corporation would be in default of the 1995 Partnership Agreement with the U.S. government that grants federal funding for its operations if it agreed with the House proposal.

This would also affect CUC’s autonomy, according to Villagomez. He recommended the filing of a resolution, instead of a legislation, to bring the matter to its Board of Directors.

“The CUC Board has been, and will continue to be, very responsive to the Legislature’s wishes regarding rates, while at the same time retaining its autonomy and the flexibility necessary to maintain the utility as a viable entity,” he said in a letter to the House Committee on Public Utilities, Transportation and Communications.

The resolution, HR 11-166, is similar to the measure, but if and when it is adopted by the House, it will have no force of law and the decision to lower the rate is entirely up to CUC board.

Mendiola, however, vowed to pursue the proposal, noting the difficulties facing local farmers during this economic crisis.

“The hard work and commitment of the CNMI’s farmers and ranchers continue to keep alive the great agricultural traditions of our forefathers, which are so intertwined with our traditional culture,” he said in a statement.

“Especially in these difficult economic times, it is incumbent upon us to continue to assist and support our hardworking farmers who are responsible for one of the few home-grown commodities which are produced locally on our island,” added the representative.

Mendiola stressed a lower utility rate would provide incentives to farmers and help them keep a profitable industry, particularly when the economic troubles of the Commonwealth are compounded by the devastation of El Nino.

“Most, if not all, U.S. states and territories have given similar incentives to their local farmers and it is my hope, with the cooperation with CUC, that we can provide additional support to the farmers of the CNMI,” he said.