CUC wants gov’t to settle unpaid utility bills • Utility agency, DOF in talks to draw up payment plan

Unable to collect payment from the government during the past few months, the Commonwealth Utilities Corporation has demanded at least $1.5 million each month to partly settle its huge debt representing unpaid utility bills since last year.

The government-owned utility firm has been in talks with the Department of Finance for the last two weeks to try to negotiate a payment schedule to reduce arrears amounting to over $11 million, according to CUC Board Chair Jesus T. Guerrero.

“We are working with the finance department to make that payment. We are asking them to make a schedule of payment,” he told in an interview.

Although they are not expecting a full settlement of the debt in view of the financial difficulties confronting the government, utility officials are hoping to receive at least $1.5 million in monthly payment.

“I’m not asking for the full amount because I know what situation the government is in right now. What we are working here is a payment schedule,” said Mr. Guerrero.

He, however, did not disclose as to any date when they will be able to draw up the easy payment plan with the finance department.

Since November, the utility corporation has been trying to collect payment from the government for the unpaid utility bills which have shot up from $6.8 million in July 1999 to over $11 million at present.

The government is CUC’s single biggest customer on the island, representing nearly 10 percent of its annual revenues of over $65 million.

Utility officials have expressed fear over the inability of the Tenorio administration to settle the debt due to its impact on its own financial condition which has also been unstable due to increasing fuel costs and declining revenues for the last two years.

Gov. Pedro P. Tenorio, on the other hand, has repeatedly pledged to settle its mounting utility bills, but has yet to make any official commitment to CUC.

But he has prodded the Legislature earlier this month to change the present system in the government utilities appropriation in order to encourage departments and agencies to conserve power and thus bring down the annual costs.

Under the current set-up, the executive branch pays for utilities of all branches of the government as well as autonomous agencies like the public schools and the college — a system which fails to promote energy conservation in public offices.

To help the government ease its burden, the utility corporation has cut its power rate from 20 cents to 16 cents — the same rate charged to commercial users — which would translate revenue loss to CUC of about $2 million each year.

Since 1997, utilities costs of public offices have steadily risen from $7 million four years ago to $10 million last year. Despite this trend, the government only allots a small fraction of the budget to pay its bills.

For his proposed FY 2001 budget, Mr. Tenorio has earmarked $4 million — the same level appropriated during the previous year’s spending package.

But the Senate, in approving the 2000 budget, took away this year’s allocation in order to increase the appropriation for Rota and Tinian municipalities. The proposal is now pending with the House of Representatives for its approval, but it is unlikely to draw support from the administration.