IPS says ARRA funds not in jeopardy

Integrated Professional Solutions, LLC assured the public in a statement yesterday that the American Recovery and Reinvestment funds it manages are not in jeopardy because of the current controversy involving the company.

Last week, a DOI Inspector General report said that the Fitial administration’s sole-source contract with former Commerce secretary Michael Ada’s IPS may have violated local procurement rules and ethics regulations.

“ARRA funds allocated to the CNMI, including those funds allocated but not yet spent, should not be in jeopardy due to current controversy. This perception among some members of the public seems to be based upon a misunderstanding of the way the relevant funds are allocated, administered, and used,” said the IPS statement.

Delegate Gregorio Kilili C. Sablan had recently said that $64 million in ARRA funds that have yet to be issued to the Commonwealth could now be in jeopardy in the wake of the IG report.

IPS said the company and its staff will work to correct these misunderstandings in the coming days. It also clarified that the IG report didn’t say that the company violated federal laws.

“IPS would like the public to note that the Inspector General did not find any violation of federal law in its report, nor did it identify the misuse of any ARRA funds. There has been no such misuse of funds by IPS. IPS would also like the public to know that IPS and its staff, particularly Mr. Michael Ada, have fully cooperated with the investigation process,” the company said.

On the question whether IPS may have violated CNMI ethics and procurement requirements, the company said it reserves comment on these issues pending further statement by the Office of the Public Auditor.

IPS also took the opportunity to enumerate its accomplishments since cornering the ARRA management contract.

It said it facilitated direct funding of 91 staff salaries for the Public School System, 6,100 netbook computers provided to CNMI public school students, 1,225 new street lights throughout the CNMI, and numerous, system-wide construction projects for the Public School System, and four new energy efficient Commonwealth Utilities Corp. turbochargers.

“Again, these are just a few of the projects with which IPS has assisted. IPS continues in its effort, in close collaboration with numerous public agencies and private companies and entities, to efficiently and effectively manage the ARRA funds that have made these and other completed and ongoing projects possible,” said IPS.

Senate Committee on Executive Appointments and Government Investigations chair Francisco Q. Cruz (R-Tinian), meanwhile, promised to “seriously look” into alleged violations of CNMI procurement and ethics statues detailed in the IG report.

“I’ve been going through the Commonwealth code and it appears true that the contract may have violated the Commonwealth code. My committee will look into this very seriously and eventually we will come out with our recommendation.”

Cruz told Saipan Tribune that a cursory review of the IG report seems to suggest some culpability on the part of Attorney General Edward Buckigham and IPS principal owner Michael Ada.

“I think he [AG] should be held responsible for all of this. If we have to go to all the way and investigate the attorney general then we have to. I think Mike should also be held responsible. These people are professional employees of the government (former government employee in the case of Ada). They are in high places in the government and they should follow the procedure,” he said.

House Speaker Eli D. Cabrera (R-Saipan) admitted that he has yet to open, much less read the IG report. He keeps himself abreast of the controversy, however, by following the news.

“How do we know local laws were broken? Mike [OPA Public Auditor Michael Pai] didn’t exactly say that there was a violation, right? He allowed AG to make the decision. Something is not really clear here, something that is a really gray area, ” he said in an interview with the Saipan Tribune.

Cabrera said he is simply too busy right now to deal with the IG report and IPS’ alleged violation of procurement rules and ethics regulations.

“I wish I could’ve opened the report last week. Yesterday we spent the whole day discussing the casino bill. I’m every busy and I’m now working on the budget.”

He said the House simply doesn’t have the authority to investigate the issue.

“The Senate has the EAGI. We don’t have the luxury to have that here. Conduct an investigation? Who shall I appoint? Under what committee and under what authority? I don’t want to do something that would jeopardize what we’re doing. If the Senate wants to do the investigation, so be it and let them do it. While they are working on the IG report, we’re working on the budget,” said Cabrera.