House gives governor full access to funds

The House of Representatives has granted Gov. Juan N. Babauta 100 percent authority to reprogram any available local funds to remedy the power crisis besetting the CNMI.

The measure, House Joint Resolution 14-36, which was introduced by Speaker Benigno R. Fitial, received bipartisan support and passed the lower chamber during a session yesterday afternoon.

House members agreed with the governor’s May 19 declaration of disaster emergency in the CNMI due to the Commonwealth Utilities Corp.’s “inability to provide service.”

It conceded that CUC will be unable to pay for its fuel oil supplies in the immediate future, its power reserve is currently almost zero and, without electricity, the CUC’s water and wastewater pumping systems will also fail.

“The Legislature supports the governor’s declaration of state of disaster emergency. …It is the intent of the Legislature to authorize the governor 100 percent reprogramming authority from available Commonwealth funds to remedy the power generation problems,” reads part of the resolution.

However, the House said the governor could not enter into any public debt without the approval of the Legislature, as provided in the CNMI Constitution Article 10, Section 3.

Further, the House cited that Article 10, Section 4 of the Constitution provides that public indebtedness may not be authorized “for operating expenses of the government or its political subdivisions.”

Vice Speaker Timothy Villagomez, chair of the House Committee on Public Utilities, Transportation, and Communications, had earlier warned that that the Executive Branch and CUC may be violating the law when they entered into a $10 million letter of credit from BoG last week.

Babauta said, though, that his office holds the view that the standby letter of credit with BoG is not public indebtedness, pointing out that CUC is “a semi-public corporation.”

“This is a semi-public corporation that we’re trying to save. It has its own assets and we are using some of its assets as collateral,” he said yesterday.

The governor encouraged Villagomez “to introduce legislation right now authorizing public indebtedness.”

There have been no further unscheduled power outages since May 17, when the Puerto Rico power plants ran out of fuel. Mobil and Shell delivered a combined 33,000 gallons of fuel to the power plants that day. A team created by the governor is now negotiating with Mobil for a long-term fuel supply contract.

Last Friday, the government got Mobil to commit to deliver 1.4 million gallons on June 2, 2005. The delivery is expected to provide CUC enough fuel to run its power generators through June.

Babauta also clarified yesterday that his emergency powers are not limited to power generation but also to other utilities: sewer and water.

Right now, he said his priority would be to ensure a stable supply of fuel and to repair the engines at CUC’s power plants in Lower Base.

He said the CNMI Water Task Force continues to address the water problems. As for sewer, he said authorities are in negotiation with the Environmental Protection Agency to secure funding to upgrade the wastewater system.