CUC: Lack of legal counsel impedes power project

The procurement of the controversial Saipan power project now hinges on how soon the Commonwealth Utilities Corporation can find a private law firm that will guide the board in implementing the law requiring the installation of a plant with 80 megawatts capacity.

The CUC board yesterday opened its search for a lawyer on island who will be hired within the next two weeks to provide legal services on such matters as the much delayed power project.

Its current legal counsel, Assistant Attorney General Bill Ohle, has resigned and is expected to end his term on June after more than four years with the government-owned utility corporation.

According to CUC Board Chair Jesus T. Guerrero, the Attorney General’s Office is presently understaffed and will not be able to provide immediate replacement to the departing legal counsel.

He said the corporation must have such legal services now in view of the time required for the board to come up with final decisions on the new power plant.

“We are prepared to award and negotiate a contract. All our decisions will be made in the best interest of the general public and we need the best legal advisors to achieve this objective,” Mr. Guerrero told a board meeting yesterday.

The new lawyer is expected to assist the board in complying with the provisions of Public Law 12-1 which Gov. Pedro P. Tenorio signed early this month to force CUC to reinstate the 80-MW plant it scrapped last January in favor of a project with lower capacity.

Former Board Chair Rosario M. Elameto, who had pushed the collapse of the initial request for proposal on the power project, was absent yesterday when the five directors approved the emergency procurement for legal services. She is in Hawaii for a family gathering, according to CUC.

15 days

Under the RFP issued for the legal counsel, the contract will be made as soon as the board has picked among the best offers. Submission of proposals starts today until May 15, 2000.

Among other qualifications, the utility corporation seeks for a law firm who has the “ability to immediately commit services and engage in urgent contract negotiations, without conflicts of time or interest” with CUC or its ongoing procurement for the 80-MW plant.

This is to assure that the bidding on the project will be spared from further protests which have already delayed the project for more than two years.

According to Mr. Guerrero, the urgent search for a lawyer is underscored by the need to have a legal advice on a continuing basis right away and that PL 12-1 sets a time frame of 60 days to award the plant’s contract.

“Time is of the essence,” he explained. “It is our fiduciary responsibility to seek fast but competitive and responsive proposals.”

The governor signed the law on April 3, giving the board until June 2, 2000 to come up with its selection of a contractor to build the $120 million project — touted to be the largest undertaking ever in CNMI’s history.

“We are aiming to complete the procurement of the new power plant in accordance with the terms of PL 12-1 within the 60 days,” said Mr. Guerrero, adding that final selection will be based on the result of the independent evaluation conducted last year by CUC’s power consultants.

The Kansas City-based engineering firm has given the highest scores to Enron, the Tomen Consortium and SPP/HEI, which were different from the findings by CUC’s in-house selection committee that chose Marubeni-Sithe in June 1998.

That decision drew protests from the bidders, eventually forcing the utility firm to hire independent consultants in the process that dragged the project for months. The Legislature stepped in early this year when CUC abandoned the initial plan.

Designed to meet increasing demand on Saipan, the proposed power plant is to be constructed through the build-operate-transfer scheme under a 25-year agreement.