OPA drops protest vs. Enron on 60MW plant

The Office of Public Auditor yesterday dismissed protest-appeals filed by three companies against the Commonwealth Utilities Corporation’s decision to award the controversial Saipan power plant project to Enron International Mariana Power Inc.

In a six-page decision on the protest-appeals made by Saipan Power Partners, Tomen Consortium, and Telesource CNMI Inc, Public Auditor Mike S. Sablan said OPA lacks the jurisdiction to review nor to proceed with the investigation of the case.

Mr. Sablan explained the auditing function of the OPA provided for under the Article III Section 12 of the CNMI Constitution described its responsibility as an independent examination of books, performance, records and other evidence relating to use of funds by any agency.

The appeals made by the three companies is a quasi-judicial proceeding by an agency tribunal and is not an auditing function supposed to be handled by the OPA, Mr. Sablan pointed out.

“Although the OPA has the authority under the Constitution to audit procurement activities such as the subject matter of these appeals, that authority is independent of the appeal process,” the public auditor said.

In addition, Mr. Sablan stressed that it makes no difference that CUC challenged the jurisdictional authority of OPA because even without a jurisdictional challenge, OPA should determine its review authority before proceeding to the issues.

The public auditor even stressed that although Gov. Pedro P. Tenorio signed Public Law 12-1 known as Energy Sufficiency Assurance Act of 2000, the same law overrides the jurisdiction of the OPA to review protests filed against CUC Procurement Regulations.

In fact, Section-7 of PL 12-1 even protects the CUC Board of Directors from possible litigation based on irregularities in the January 2000 meeting, by mooting the decision to cancel the RFP.

The law also mandates CUC to make an award based on proposals that provide for low speed generators as recommended by Burns & McDonnel, the utility corporation’s power consultants.

“PL 12-1 overrides OPA’s jurisdiction to review any protest involving issues raised in the appeals, and evolving from CUC RFP 97-0025, lacking jurisdiction to proceed with the protest appeals, we hereby dismiss the appeals,” the OPA decision reads.

The Saipan Power Partners, Telesource CNMI Inc., and the Tomen Consortium earlier filed a formal protest against CUC following the awarding of the 60-megawatt power plant to Enron.

The three opposed the awarding of the contract stressing violation of PL 12-1 which is the basis of CUC’s decision to choose Enron over other bidders.

Officials of CUC earlier disclosed that negotiation with Enron will push through this month as utility officials see the need to expedite the project before possible engine breakdown of other power grids start.