CUC cuts power to CHC

Posted on Sep 09 2020

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Crew members of the Commonwealth Utilities Corp. are seen disconnecting the hospital’s power supply last Sept. 8. (JUSTINE NAUTA)

The Commonwealth Utilities Corp. followed through yesterday with its threat to disconnect the Commonwealth Health Center’s power supply for six hours every day.

A CUC crew cut off the power supply to the hospital at about 12:30pm yesterday, at the instruction of the CUC board and CUC chief Gary Camacho. This means CHCC’s backup power generator will be used to run the hospital for six hours daily.

The Commonwealth Healthcare Corp., which runs the hospital, immediately took to its Facebook page to assure the public that the power disconnection will not affect their services.

The disconnection is only six hours every day, from 12pm to 6pm. That means a CUC crew will go to CHC every day to cut power to CHC at 12pm, then go back there at 6pm to reconnect the hospital to the power grid. CUC earlier said that doing so would allow the hospital to bring down its power cost and be able to pay its monthly billing.

Both CHCC board chair Lauri Ogumoro and CHCC chief executive officer Esther Muña said in earlier interviews that disconnecting the hospital’s power will jeopardize its Centers for Medicare and Medicaid Services eligibility since CMS requires a hospital to have stable power. Muña also stated multiple times that running the hospital on a generator is not a good idea because there is no “backup for the backup [generator].”

This development comes even after Gov. Ralph DLG Torres assured last Friday, Sept. 4, that CUC won’t cut CHC’s power supply yesterday.

Lesser than agreed amount

The Torres administration paid the Commonwealth Utilities Corp. $2.5 million two weeks ago and an additional $150,000 yesterday for more than half of the Commonwealth Healthcare Corp.’s outstanding obligations to CUC but power was still cut off to the hospital yesterday because CHCC paid only $2,000 of the $50,000 it needed to pay monthly, according to press secretary Kevin Bautista.

He said Torres and Lt. Gov. Arnold I. Palacios have committed to both CUC and CHCC by supporting the continuity of CHCC’s operations, while making sure CUC is paid and does not raise rates on ratepayers to cover CHCC’s liabilities and arrears. Aside from the payments of $2.5 million and $150,000, Torres and Palacios have committed $150,000 a month to continue assisting CHCC with its utility arrears, Bautista added.

“Our hospital is a priority, which is why Gov. Torres and Lt. Gov. Palacios are diligently finding resources to keep them operational during this pandemic,” he said.

Bautista said they also recognize CUC’s position and are making sure that any unpaid liabilities by CHCC do not carry over to ratepayers, who need to be protected as well due to the economic impact everyone is facing.

CHCC statement

In a letter sent to CUC executive director Gary Camacho and the CUC board yesterday, CHCC said that the draft settlement agreement that CUC proposed to settle their billing dispute is not an accurate representation of what all parties agreed to at a meeting with Torres. CHCC added that CUC added “all sorts of claims that were never discussed,” such as the total amount that has accumulated over the years.

CHCC stated that the meeting they had with both CUC and Torres was about current billings. “To this end, CHCC put up $50,000 per month plus actual usage by federal programs (which was already being paid and would continue to be). In addition, the central government would pay $150,000 on behalf of CHCC to CUC every month,” said CHCC.

The central government paid half of the requirement CUC asked CHCC to put up, which was $2.5 million out of the $5 million that CHCC reportedly owed. All parties agreed that there will be a monthly payment of $250,000 from CHCC and the central government.

“The impetus of the meeting was threats made by the CUC board to the CHCC board. It is unseemly to have these two very important semi-autonomous corporations publicly fighting during a time of already heightened tensions in a pandemic,” said CHCC. “The governor was rightly concerned about the perception of these two most important public entities being at loggerheads and undermining confidence in the government at this crucial time. So, in good faith, he arranged a meeting to resolve the issue of the current billings. That issue was resolved, with both the CEO of CHCC and the executive director of CUC and members of both boards meeting with the governor on Capital Hill.”


In a separate interview, CUC’s Camacho stated that CUC board instructed the management to disconnect CHCC’s power supply until some of their requirements are met—primarily payments.

Camacho confirmed that Torres paid 65% of CHCC’s current usage. He added that what CHCC owed went down to a minimum requirement of $250,000 monthly.

A balance of approximately $49,000 is owed CUC in order to stop the six-hour daily disconnection at CHC. Additionally, Camacho said that CHCC has accumulated a $34 million balance over the years, and that CUC needs a payment scheme that will satisfy CHCC’s monthly bills and not let other consumers foot the shortfall.

“We’re just trying to do the best we can under the current situation. There’s a lot of things that need to be replaced, and we need to get the necessary funding to again reinvest in our water, wastewater and other systems on all three islands to ensure that we can provide services for all the people, particularly those that do pay,” said Camacho.

CHCC assured that it will continue to make payments that was agreed upon at the meeting with Torres. It asked the CUC board and Camacho to work with the hospital to prepare an agreement that is in line with what was agreed upon at the meeting with Torres last Aug. 27. (With Ferdie de la Torre)

Justine Nauta | Correspondent
Justine Nauta is Saipan Tribune's community and health reporter and has covered a wide range of news beats, including the Northern Marianas College and Commonwealth Health Care Corp. She's currently pursuing a bachelor’s degree in Rehabilitation and Human Services at NMC.

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