CUC: No power rate adjustments

The Commonwealth Utilities Corporation yesterday denied reports it will increase power rates in the Northern Marianas. It said adjustment of charges pass through a legitimate process that would allow the public to comment on any proposed rate changes.

During a recent CUC Board of Directors meeting, Executive Director Timothy P. Villagomez presented a financial report that indicated a loss in operating funds due primarily to increasing fuel bills, the CNMI Government debt of $12 million, and increased expenses related to negotiations for a power plant.

The board said that the “most prudent action” is to accept management recommendations to severely restrict utility expenditures, improve customer collections, decrease expenditures, and to strictly follow regulations on disconnections in order for revenue to go up and to pay vendors.

The board’s only action was a request for copies of a 1996 Privatization Feasibility Study that contains a report on the actual cost of providing utility services to customers on Saipan, Rota and Tinian.

According to CUC Communications Advisor Pamela Mathis, no rates may be changed unless and until several procedures are followed.

These procedures include: the government body post and advertise its agenda at least 72 hours prior to a meeting; the agenda must clearly name items to be discussed; a vote must be approved by the majority of the members, the action is then published in the Commonwealth Register for not less than 30 days; public comments are registered, and she would then conduct public hearings on all three islands.

After public comments are collected, the item is placed on a future agenda for second consideration; the board votes a second time; that action is published in the Register a second time for a minimum of ten more days, and the action would take effect only after all of those procedures are taken.

A Saipan Tribune article that came out April 19, based on an interview with Senate Vice President Thomas Villagomez, noted that CUC has approved a 10-year rate structure proposal which would have increased power rates on Saipan, Tinian and Rota.

But Mr. Villagomez, who is also chairman of the Senate Committee on Public Utilities, admitted he had mistakenly interpreted minutes of his meeting with CUC Board Chair Jesus R. Guerrero and the power firm’s executive director last April 16.

The senator corrected himself and the Saipan Tribune report on April 20, pointing out that what CUC had actually adopted was a plan to commission another study on possible power rate adjustments.

On April 6, the CUC Board of Directors met in regular session. A transcript of the meeting minutes proves that the board took no action to increase rates. To the contrary, Laura I. Manglona, board vice chairperson, said, “As far as rates increase, I think that will be the last on my list.” Chairman Guerrero followed, ” I believe your comments are as good as mine, and I agree with you.”