Delay may render water project costs outdated

In a bid to push a proposed water desalination plant on Saipan, the Commonwealth Utilities Corporation is eyeing alternative ways to resolve the funding problem that has stalled the $100 million project for nearly two years, officials said.

Board members of the government-owned utility firm may have to decide soon whether to move ahead with the plan, which has been held off twice due to the high costs of building the water facility at this time of economic crisis.

But CUC Executive Director Timothy P. Villagomez said he is reviewing all aspects of the project to come up “with an alternative approach” to address the financial issue.

“It has been two years already. I don’t know how valid the costs are. Even if they are valid, technology changes,” he said in an interview. “We need to decide whether we want to award something now on a plan that was done two years ago.”

Villagomez was expected to present a new approach on the financial aspect in a meeting with Operations Committee of the CUC board over the weekend before any decision is made.

Committee chair Laura I. Manglona told a board meeting last week they would need another round of analysis and discussion to determine the fate of the stalled project, while a member urged that a public hearing be held again.

The desalination plant, to be built at a cost of $10 million by Earth Tech, a U.S. water technology and engineering firm, has been on hold due to failure to come to terms on where to source funding for the project.

In spite of its long-term solution to the perennial water shortage on Saipan, island residents have frowned on a proposed cost-sharing arrangement that will raise CUC rate by about 10 times higher than what they are paying now.

Utility officials maintain the increase will be sufficient to pay the $5 million in annual billings to purchase some three million gallons of water everyday from Earth Tech for 20 years as part of the project’s build-operate-transfer scheme.

Although the costs may not drastically change, Villagomez said the board has to take another look at the project and decide “what they want to do” with it.

The utility chief earlier has urged for the cancellation of the costly project while CUC seeks other ways on how to build the desalination facility at a lower price since a higher water rate is the only possible solution to the funding issue.