CUC board racks up $9K plus in over-expenditures

The Commonwealth Utilities Corp. board has outspent by $17,704 its year-to-date budget of $24,925 nine months into the fiscal year, with most money going to “per diem” costs for board members, a breakdown of board expenses shows.

The CUC board has held eight meetings in less than two months. Their annual budget is $33,300. As of July 7, the CUC board has spent $42,679.31.

If the CUC board were to halt expenses today, they would still have exceeded by $9,379.31 their budget with three months left in the fiscal year.

CUC board treasurer Joe Torres, who was voted to this position on Wednesday, said these expenses were “justified.” He stressed that it was in their by-laws to have committees established, adding that the reason for the personnel committee was to “address all employees disputes” who are “terminated or pending termination.”

“I feel the committee has accomplished a lot,” he said yesterday.

On Wednesday, the board went into executive session with their legal counsel to discuss counsel’s concerns with use of “per diem.”

Per diem is reported to be around $175 for every four hours for a board member.

Torres said yesterday that if the management was paying a per diem that was “not correct” then they should not continue to overpay. “If they know it’s not right, then they should correct it. Don’t let the mistake continue. If you are a paying a per diem that is not correct, then it is the responsibility of the comptroller to fix it,” he said.

The board’s expenses combine per diem, honorarium fees, car rental, and airline tickets.

Albert A. Taitano, who chairs the personnel committee, has racked up $5,250 in per diem, and $540 in honorarium fees. He was sworn into the board last April.

Fellow Rota board director Diego Songao has racked up $5,337 in per diem and $570 in honorarium fees. Songao has been with the board since the start of the fiscal year. He was not named as part of a committee.

Board director David Sablan Jr. brought the budget shortfall to the board’s attention on Wednesday, saying they needed to move some money because they have exceeded their budget. “I think we need to exercise some prudence,” he said.

Torres on Wednesday said since that came in to the board he was asking for a budget but was never provided one. Torres later told Saipan Tribune this budget was voted on when he was not yet with the board.

Sablan said they approved this budget last year.

“I think we got to slow down in some of these operational meetings,” Sablan said, referring to CUC’s committee meetings. “We have to be very prudent of how we schedule these meeting’s because it’s really in honorarium and per diem that costs exceeded reasonableness.”

Sablan said honorariums and per diem are “controllable costs.”

He asked the two committees to exercise caution and restraint.

“This board has to address this shortfall. Otherwise, we would be moving into an area of tremendous deficit with three months left,” Sablan said.

The board also discussed board chair Adelina Roberto’s business trip to San Francisco to authorize a settlement between CUC and a company.

Roberto, who is a board member from Saipan, is tagged $2,321 for airline ticket expenses, according to the board budget breakdown.

Torres said the trip was of great benefit to CUC, adding that this could be put on a management account.

Torres said Roberto’s presence was the request of the CUC management.

“We are using the board budget when it’s supposed to be management,” he said.

However, CUC counsel James Sirok said his request was for the board to designate someone to have the authority to act on behalf of CUC.

The board on its own decided that that someone would be Roberto, Sirok said.

Roberto had volunteered herself.

Originally, it would have been the executive director, which would have made it a management cost, Sirok said.

The board had given the executive director the authority to bind the corporation to a settlement amount.

“It is a technical point but what I am saying to you in response is, the board on it’s own decided that person would be a board member and not a management member,” Sirok said.

Sablan further said he was not arguing on what the committee’s work was, but that they had exceeded their budget and must exercise prudence.

“We have been holding a lot of personnel and operations meetings, which is causing the expense to go up. Because that equates to per diem and honorarium for our two travelers who have to come in for those meetings.”

Torres said most of these problems are personnel, and they have been addressing a lot of problems with this body.

“I think we have resolved quite a bit of them. We had one were we spent three days on that one case. We are still not done yet,” Torres said.

Songao said he thought there was a law that prohibits honorariums and per diem for standing committee meetings.

Sirok said they could discuss this point in executive session. But added that on this point, the Open Government Act indicates that standing committees and subcommittees are not entitled to honorariums.

He said there were some concerns he would like to bring to the board in executive session dealing with how the per diem is spread out.

At the end of discussion, the CUC board voted to task management to come up with a recommendation to a board to cover its current shortfall plus another three months of additional funding to take them through the end of the year covering potential per diems, honorarium, car rental, airline tickets, and per diem.

For next fiscal year, the board has approved a budget of $50,000 for their expenses.

The expenses of board directors as of July 7 are as follows:

Expenses for per diem, honorarium, car rental, and air line tickets for Adeline Roberto are $1,220, $1,170

Roberto is tagged $1,220 in per diem, $1,170 in honorarium, and $2,321 in air ticket costs for a total of $4,711.

Taitano is tagged with $5,250 in per diem, $540 honorarium, $805 in airline ticket costs for a total of $6,596.50. He was sworn in on April 6.

Christopher Concepcion is tagged with $780 in honorarium.

David Sablan Jr., who lives in Guam, is tagged with $3,325 in per diem, $660 in honorarium, $556 in car rental, and $2,869.41 in airline costs for a total of $7,411.06

Eric San Nicolas, who is from Tinian, is tagged with $7,831.25 in per diem, $1,050, $893 in car rental, $1,311 for airline costs for a total of $11,085.25.

Diego M. Songao, who is from Rota, is tagged with $5,337.50 in per diem, $570 in honorarium, $917 in car rental, $2,564.50 in airline ticket costs for a total of $9,389.

Joseph Torres is tagged with $1,080 in honorarium fees. He told Saipan Tribune yesterday his $60 or $30 in fees was a minor figure compared to the time he could spend on his personal business. He said he serves for the interests of the Commonwealth.