Villagomez to administration: Repeal FSF

Vice Speaker Timothy P. Villagomez called on the Babauta-Benavente administration yesterday to sign House Bill 14-343 into law.

House Bill 14-343, a bill Villagomez authored at the request of numerous constituents, proposes to repeal the Commonwealth Utility Corporation’s fuel surcharge fee in its entirety.

“I join many of my constituents in opposing this big increase in utility costs,” said Villagomez, Covenant-Saipan. “And that is why I authored this bill to grant some financial relief to our struggling commercial and residential consumers.”

House Bill 14-343 passed the 14th CNMI House of Representatives unanimously, garnering the support of all House minority members, including Reps Heinz S. Hofschneider and David M. Apatang. The measure was also approved in the Senate, with two members abstaining from the vote.

Administration officials have publicly characterized House Bill 14-343 as an “irresponsible” bill. Villagomez, however, dismisses such charges, calling them “cynical and jaded excuses designed to mask the administration’s marked failure to successfully manage CUC’s financial operations since assuming public office in January 2002.”

“What is truly irresponsible,” said the vice speaker, “is mismanaging the operations of CUC for the past three and a half years and then turning around and forcing our consumers to pay for this government’s huge financial mistakes.”

Villagomez maintains that the government should pay for its mistakes rather than penalize consumers and believes that supporters of the CUC fuel surcharge fee are “irresponsible” because “the surcharge fee hurts families, hurts businesses, hurts jobs and consumers, and hurts our stagnant economy.”

CUC initially imposed a 1.5-cent fuel surcharge fee per kilowatt-hour but quickly raised the rate to 3.5 cents per kilowatt-hour within a few weeks. CUC and the administration have not categorically ruled out further fuel surcharge increases in the future.

Local business groups, such as the Saipan Chamber of Commerce and the Hotel Association of the Northern Mariana Islands, have previously expressed strong concerns regarding the impact of CUC’s fuel surcharge fee on business and the economy.

Villagomez believes the fuel surcharge fee could be eliminated or drastically reduced through the sound financial management of the central government, such as the reduction of unnecessary travel and consulting contract expenses.

Villagomez had previously proposed at least three separate alternatives to the surcharge fee: an increase in the government’s utility rate, the use of Compact Impact Funds, and the waiver of CUC’s massive debt to the Commonwealth Development Authority. The vice speaker has also called on the governor to reprogram funds to pay for the central government’s overdue CUC bills, which reportedly amounts to more than $20 million in potential CUC accounts receivables.

The lawmaker, a former CUC executive director, chairs the House Committee on Public Utilities, Transportation and Communications. Villagomez reportedly left CUC with a $20 million cash surplus and did not impose a fuel surcharge fee during his tenure at CUC, even during the steep increase in fuel costs during the first Gulf War in the early 1990s. (PR)