The self-described \u201cmajority\u201d of the Commonwealth Utilities Corp. board ousted Diego Songao from the position of vice chairman last week because they said they wanted someone \u201cwho worked with them.\u201d<\/p>\n
Eric San Nicolas, from Tinian, is now vice chairman. The CUC board also voted to name director Joe Torres, from Saipan, to the position of treasurer. This position had been unfilled.<\/p>\n
Directors San Nicolas, Torres, Albert Taitano, Chris Concepcion, and Adelina Roberto voted in favor of removing Songao from the vice-chairmanship and replacing him with San Nicolas. Songao abstained from voting. Director David Sablan voted against.<\/p>\n
For the treasurer position, all board members voted for Torres to fill the position, after some questions from Sablan on whether Torres understood the ramifications and responsibilities of the position, and if Torres had actually read the board\u2019s bylaws on the position.<\/p>\n
Taitano motioned to include the election of the vice chairman on the agenda at the beginning of their meeting.<\/p>\n
When asked by Songao for a reason, Taitano said they want to elect a vice chair that \u201cworks with the majority\u201d of the board members.<\/p>\n
To this, Songao said if his vote is not what the majority wants, then he has all the privilege to do so.<\/p>\n
In an interview yesterday, Torres said that \u201chaving board members that can work together and accomplish things is needed,\u201d given CUC\u2019s financial situation.<\/p>\n
\u201cWith this group, I feel it is a work team. It is transparent,\u201d he said, referring to the group that voted to replace Songao with San Nicolas.<\/p>\n
CDA implications?<\/strong> Songao pointed to previous \u201csurface discussions\u201d among CDA board members to \u201cprotect its interests.\u201d<\/p>\n In 2004, a memorandum of agreement between CDA and CUC turned more than $200 million in debt plus interest into $45 million in preferred stock held by CDA. Since 2009, when the MOA was executed, CUC has not put a penny on its over $1 million in dividend payments per year, deferring all payments.<\/p>\n CUC, at the recent direction of the board, is now requesting a moratorium to debt payments and has expressed a preference to not include debt payment in future tariff rates.<\/p>\n \u201cIf this board does not take the responsibility to ensure CUC meets its obligations, and also provide guidance and direction for a good, financial standing for CUC, CDA might come in to take over management of CUC,\u201d Songao said.<\/p>\n To this, Torres said, \u201cThat\u2019s not a threat, vice chair?\u201d<\/p>\n Songao said it was not a threat but it was CDA\u2019s position because of its concerns with the way CUC is handling its financial obligations.<\/p>\n Sablan described Songao\u2019s removal from the vice chairmanship because he was not in the majority a \u201cpoor reason.\u201d He asked if the real reason was because they did not want Songao and himself on this board.<\/p>\n \u201cWe are deliberating [and it is] sometimes heated\u2026but to just remove him from the vice chairmanship, to squelch him, I don\u2019t think is a good enough reason,\u201d he said.<\/p>\n In an interview, Songao said he should be able to speak his mind and to protect the interests of CDA. \u201cI should make decisions according to fiscal responsibility, according to how we should have CUC be responsible for its operations,\u201d he said. \u201c\u2026I\u2019d like to see that we maintain that CUC meets its obligations and put CUC in a good financial standing.\u201d<\/p>\n On Songao\u2019s \u201cthreat\u201d to have CDA move to take over CUC, Torres said yesterday that Songao was only one member of the CDA board. The board decides issues, not one member, he said.<\/p>\n \u201cThe way Songao made his comment is threatening the people of the Commonwealth\u2026That\u2019s not right,\u201d Torres said, adding that if CDA was a major stockholder, why hadn\u2019t they pumped money into CUC?<\/p>\n Treasurer<\/strong> Songao had also asked if the board had a set of responsibilities in its rules and regulations, and if every disbursement that came out of CUC would have to be signed by the treasurer.<\/p>\n To this, CUC legal counsel James Sirok said the treasurer signs checks as one of the signatories and manages accounts.<\/p>\n Sablan said that from his experience in other organizations, if anything goes wrong financially, the \u201ctreasurer goes to jail.\u201d<\/p>\n Sablan asked Torres if he was ready to handle that responsibility, and has read the responsibility in the b-laws and what it entailed.<\/p>\n \u201cI don\u2019t foresee any problems,\u201d Torres said.<\/p>\n \u201cHave you read the bylaws…? I think it is important for you to tell us,\u201d Sablan asked again.<\/p>\n Torres said yes. San Nicolas said they have utmost confidence in Torres.<\/p>\n Next moves<\/strong> In April, the board voted out Sablan from the chairmanship. In May, executive director Alan Fletcher announced he would not be renewing his contract with CUC. The board had made a decision to not continue with Fletcher, Saipan Tribune learned then.<\/p>\n The majority has also raised questions whether the CUC board should have \u201ctheir own\u201d legal counsel. The counsel for the CUC board and management is James Sirok. The majority has also raised concerns on moves by previous chair Sablan and vice chair Songao to interview individuals for CUC\u2019s top positions without their knowledge. One of these positions was for current chief financial officer Matthew Yaquinto.<\/p>\n However, when asked, Torres said he did not prefer to use the word \u201cmajority.\u201d \u201cIt separates people,\u201d he said of this term. \u201cIt\u2019s a working group,\u201d he said instead. \u201cSongao and Sablan can be part of the working team if they want to.\u201d<\/p>\n When asked to comment on the board\u2019s recent moves, Torres said he would like to put the issue concerning Fletcher \u201cto rest.\u201d \u201cLet\u2019s move forward for what is best to serve the public.\u201d<\/p>\n Torres went on to say this working team\u2019s goal is to keep rates the same, resolve a payment plan with the local hospital, and improve CUC\u2019s distribution systems.<\/p>\n On the other hand, the board\u2019s \u201cminority,\u201d management, and consultants see a need for rate increases to protect the utility from collapse, given millions in unpaid utility bills owed to them, among other reasons. They also aim to take a hard look at hospital\u2019s finances and see what it can pay them as its debt sits at around $16 million and growing.<\/p>\n","protected":false},"excerpt":{"rendered":" The self-described \u201cmajority\u201d of the Commonwealth Utilities Corp. board ousted Diego Songao from the position…<\/p>\n","protected":false},"author":47,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[4],"tags":[366,49,1421,244],"class_list":["post-206566","post","type-post","status-publish","format-standard","hentry","category-local-news","tag-cda","tag-cuc","tag-eric-san-nicolas","tag-utility"],"_links":{"self":[{"href":"https:\/\/www.saipantribune.com\/index.php\/wp-json\/wp\/v2\/posts\/206566","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.saipantribune.com\/index.php\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.saipantribune.com\/index.php\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.saipantribune.com\/index.php\/wp-json\/wp\/v2\/users\/47"}],"replies":[{"embeddable":true,"href":"https:\/\/www.saipantribune.com\/index.php\/wp-json\/wp\/v2\/comments?post=206566"}],"version-history":[{"count":0,"href":"https:\/\/www.saipantribune.com\/index.php\/wp-json\/wp\/v2\/posts\/206566\/revisions"}],"wp:attachment":[{"href":"https:\/\/www.saipantribune.com\/index.php\/wp-json\/wp\/v2\/media?parent=206566"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.saipantribune.com\/index.php\/wp-json\/wp\/v2\/categories?post=206566"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.saipantribune.com\/index.php\/wp-json\/wp\/v2\/tags?post=206566"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}
\nSongao, who appeared upset by the board majority\u2019s intentions, said at the meeting that he was there to represent the Commonwealth Development Authority, a preferred stockholder of CUC.<\/p>\n
\nBefore the vote for treasurer, Sablan said the office of treasurer is a major responsibility, and is responsible for all the financial affairs and is subject to penalties if anything goes wrong. \u201cI think you need to look at the ramifications of that responsibility,\u201d Sablan told Torres.<\/p>\n
\nWhile the term was not used last week, the \u201cminority\u201d in the board are clearly Sablan and Songao. Saipan Tribune learned there have been frustrations from the board majority over CUC management\u2014from their counsel, to executive director, to public relations officer\u2014raising questions about what the board majority\u2019s next moves might be.<\/p>\n