More discussions sought on bill to write off CUC’s debt
Further movement on a House bill that seeks to write off the Commonwealth Utilities Corp.’s debt with the erstwhile Commonwealth Development Authority has stalled after a House committee that’s looking into the measure decided to table the bill pending future discussions.
This comes soon after House of Representatives legal counsel John Bradley pointed out that CDA, now known as the Commonwealth Economic Development Authority, believes that there is no longer any loan debt. He said he learned this from CEDA itself.
“It doesn’t exist because they settled,” he said, referring to the CDA-CUC settlement.
House Bill 23-52 which the House of Representatives Public Utilities, Transportation, and Communications Committee was looking at, seeks to impose a settlement on that CUC debt by writing it off.
Bradley said, however, that that debt doesn’t exist anymore as CEDA very expressly stated.
“So even if you pass this bill, as it’s written, it would not accomplish what you want. It would be simply eliminating a debt that doesn’t exist,” he pointed out.
He said the bill essentially would do nothing because the debt was resolved by converting it to shares in CUC, which Bradley thinks is a “very odd” arrangement. Bradley stated at the hearing that such an arrangement raises other legal issues that they don’t need to discuss that day.
It was Rep. Blas Jonathan T. Attao (Ind-Saipan) who asked Bradley to chime in on the 2004 CUC-CDA settlement because the lawyer was part of the previous PUTC’s conversation with CEDA in regards to ownership of CUC dividends.
The CDA-CUC settlement arose during discussions on H.B. 23-52.
The PUTC chaired by Rep. Vincent S. Aldan (Ind-Saipan) agreed to table H.B. 23-52 after Attao suggested that they should hold off on the legislation right now so they can have a meeting with CEDA, CUC, and even the Commonwealth Healthcare Corp., plus a central government representative.
With CUC’s loan converted into shares that are now held by CEDA, that means CEDA now has an ownership stake in CUC and is receiving dividends.
If the PUTC and the House as a whole is interested in how to address the shortage of payments to CUC by various government agencies, the money is no longer sitting as a loan. He said the money is streaming as paid dividends from CUC to CEDA and some of that money has already been distributed in various ways.
“One of them was to send some money over to help with the NMC [Northern Marianas College] and other important projects. So that’s where the money is if you’re looking for it,” Bradley said.
Blas Jonathan T. Attao
John Bradley
