Board instructs PSS to pay CUC $200K

The Public School System is planning to pay the Commonwealth Utilities Corp. $200,000 in an effort to keep the utility agency from disconnecting their power. PSS owes approximately $1.3 million in past utility fees.

In a statement, Gov. Benigno Fitial urged CUC executive director Antonio Muña to pursue all past due accounts.

During Board of Education committee meetings yesterday, the board directed Education Commissioner Rita Sablan to use the approximately $200,000 left over from the budget to cover the past payments, BOE chair Lucy Blanco-Maratita said.

“If we owe, we should rightfully pay it, if we have the money,” Blanco-Maratita said.

The problem, she said, is that there is simply not enough money to pay for all the utilities. “I don’t know when we’ll pay everything. There’s nothing else we can do,” she said.

Blanco-Maratita said the school system must also allow enough money to pay for vendors who are still waiting.

“We’ve got to pay those vendors first,” she said. “Those vendors are the ones we’re going to be working with to supply whatever the schools need.”

A recent report by Georgetown Consulting showed that CUC’s accounts receivable totaled $31.2 million in fiscal year 2007, $9.6 million of which came from government agencies.

Fitial said he wants Muña to pursue all collections because “the cash-strapped CNMI government, which has had to dramatically reduce its operating budget, is in no position to subsidize CUC operations.”

According to the statement, Muña has said the CNMI central government is now current in its utility payments, but is still waiting for the Public School System to make their payments.

“At the end of the day, disconnection will not be up to CUC; it will have to be done by urgent necessity, as a result of actions taken by Mobil, Telesource, Aggreko, PMIC, and Shell-CUC’s vendors for fuel, power, lube oil, and chlorine,” Muña said in the statement.

CUC also needs funds to meet compliance requirements stipulated in an order recently filed by the U.S. Department of Justice and the Environmental Protection Agency, which stems from the utility company’s failure to comply with federal regulations governing water, sewer, power, and fuel.

According to Finance Secretary Eloy S. Inos’ fiscal year 2008 preliminary report to the House of Representatives, the government spent $4.6 million on non-allocated utilities and $2.7 million for fuel expenses for the year.

Charles Reyes, press secretary for the Governor’s Office, said outstanding accounts like PSS’ could ultimately affect everyone.

“I know there’s this rhetoric to appeal to the children, that’s all very true. But the bottom line, as [Tony Muña] said, is the bills must be paid,” Reyes said.

In September, Muña said CUC was counting on PSS and the central government to pay their past due balance of several million dollars to help pay for the Aggreko generators.

Up until October 2006, the government paid for PSS’ utility usage, so CUC and PSS officials had earlier determined the government would pay for that portion of the debt. But at the October Board of Education meeting, vice chair Herman Guerrero said Inos told him PSS must pay the $414,000.