Camacho says ‘CUC should pay for travel expenses’

The Commonwealth Utilities Corporation is virtually responsible for all the off-island travel damages incurred during the whole-year transaction with Enron thus moves to collect payments will be futile.

Even during the early part of the negotiations, Enron made it clear beforehand that the negotiation is for the pending forging of agreement. CUC did not directly award the project to Enron and the off-island travels are for the ultimate agreement for the construction of the 60 megawatt Saipan power plant.

House Committee on Public Utilities, Transportation and Communication chair Rosiky Camacho disclosed yesterday that all the travel tabs and off-island expenses during the negotiations will be closely scrutinized when the Legislature holds a joint inquiry on April 25.

The inquiry is originally for the $150-million outstanding debt of the utility corporation to the Commonwealth Development Authority under the Equity Conversion Agreement.

“Definitely we will look into that. They know beforehand that there was nothing definite on that negotiations,” said Mr. Camacho in an interview with reporters.

The legislator explained that attempts to recover funds used for these off-island travels won’t yield positive results, adding that Enron is not liable for these expenditures.

The Legislature will scrutinize how CUC officials spent the taxpayers’ money on the numerous travels made by utility officials and members of the negotiating team, he added.

Further, legislators will also tackle other options left for CUC to proceed with the multi-million power plant project.

Mr. Camacho pointed out that under the blanket provision of Public Law 12-1, CUC should award the project to the next lowest bidder.

CUC Vice Chair Laura Manglona, who also heads the negotiating team, recommended the possibility of recovering damages from Enron for CUC’s negotiating cost and delay of the project.

She said instructions were made to legal counsels for Saipan power plant project to research on the case and pursue recovery by litigation.

Utility officials are bent to collect all damages from Enron and calls for the immediate amendments on PL 12-1 to proceed with the power project plant.

CUC Board Chair Jesus T. Guerrero said the corporation remains off-track on how to resolve the issue brought about by Enron’s decision to pullout from the negotiating table.

The chair remains adamant that the problem will not be addressed unless amendments to the Energy Sufficiency Assurance Act of 2000 are made.

“What can we do, our hands are tied. The public law was made solely for the negotiations with Enron,” said Mr. Guerrero adding that there is no other way to proceed with the project unless changes are made on Public Law 12-1.

Without the needed amendments, the CUC’s abandoned power plant project will have to be bided out again to interesting companies like Tomen Consortium, Saipan Power Partners, and Telesource CNMI, Inc.

The Houston-based power company backed off from the negotiating table after almost a year of transaction.

Tomen Consortium legal counsel Robert O’Connor appraised earlier that within the next 30-days, CUC should be able to wrap up a contract agreement with the consortium in accordance with PL 12-1.

Under the existing procurement regulations, CUC is obligated to forge a contract with the next lowest proposal on the RFP requirements, based on the corporation’s procurement policy.

Further, awarding the contract with the next lowest proposal bidder will change the entire landscape of the current court case filed against the CUC. (EGA)