‘Separation of utility services complicated’

The Legislature has warned about the proposed separation of public utilities, citing that it may violate a federal agreement, among others.

House Vice Speaker Timothy Villagomez said Wednesday that the Commonwealth Utilities Corp. should be cautious with its actions as it is subject to the terms and conditions of its partnership agreement with the U.S. Department of the Interior.

Villagomez said that the partnership agreement “goes against the separation” of water, sewer, and power utilities.

“That [agreement] has to be considered,” he said.

Further, Villagomez, who chairs the House Committee on Public Utilities, Transportation, and Communications, said that creating an entirely new department for water and sewer services would cost a lot of money.

“I have not seen anything that could be tapped for that. There’s just no funding, not in this new appropriation bill,” said the lawmaker.

Villagomez, a former CUC executive director, said he has not seen any draft legislation for the proposed separation of services.

He said that even if the governor would issue an executive order authorizing the separation of the two services from the CUC, it still requires the approval of the Legislature.

“Even with that [executive order], it has to go through legislation,” he said.

Gov. Juan N. Babauta earlier said that he might decide to issue an executive order to effect the separation of the utilities, if legislative action is not made promptly.

“The way to separate it is through legislation, but if it’s going to take a long time, I’d issue an executive order. That’s being contemplated on,” Babauta had said.

The CUC board of directors had adopted a resolution urging the Babauta administration to initiate the amendment to the CUC Act to remove the water and sewer operations from the utility firm’s responsibility.

The CUC board said that getting rid of the sewer and water services would promote greater efficiency in the delivery of these programs.

CUC said that the Legislature might create a separate entity—which may be called the “CNMI Waterworks Authority”—to manage the operation of water and sewer services.

The proposed agency authority would be placed under the CNMI central government, while the CUC, would continue to be an autonomous agency, handling only power generation and distribution.