Telesource CNMI Inc. statement

As Sen. John McCain says, no matter who wins the election, there will be change. Drastic change is exactly what we require at the CUC. It is refreshing to finally see a momentum developing among our elected leaders to insist upon and to bring about this change, without regard to partisan politics or special interests. Also, there are certain private citizens who have all along spoken out against the lack of transparency and mismanagement of the CUC. These voices we hope will soon be vindicated.

How many consultants has the CUC hired, and how many times has it issued power privatization RFPs, and how many times has it been determined that CUC failed to write or manage a fair procurement process? It is time to call a spade a spade, and it is time for change. Telesource applauds Mr. Antonio Muna for his willingness to assume the executive directorship of the CUC. It is not an enviable role to be sure. We encourage Mr. Muna to be courageous and to show his well recognized independence of thought, strength and fortitude.

CUC has more than doubled its rates in recent weeks and Telesource believes this is the correct step for now. But, can CUC be operating more efficiently, with more fuel efficient engines, with less line loss and at substantial savings to the consumers from the current rates? The answer is a resounding YES! Unfortunately however, the CUC has been unable or unwilling to make the right decisions that would benefit our consumers. If the Administration focused only on what’s in the interest of the CNMI people and put aside special interests, there is no doubt that they can bring about the type of change required.

This week CUC has signed an agreement for the supply of emergency power. The legal basis for the contract is suspect, to say the least. But the costs associated with the contract are exorbitant compared to the alternatives available locally. Why hasn’t CUC investigated these alternatives? Why won’t CUC acknowledge that Telesource has 10 MW of power that it can bring from Tinian at a cost nearly 50 percent less than what CUC will now pay Aggreko for emergency power? While CUC is deciding to pay double rates for badly needed energy, why don’t they pay Telesource for the energy it provides Tinian? Is it possible that the Administration doesn’t welcome Telesource as a partner in finding solutions to the power crisis on Saipan? Is it possible that CUC already has Administration-nominated preferred service, but not solution, providers? The recent contracts issued by CUC on an emergency basis for which there has been no accountability are appalling. Who is benefiting? Telesource will continue to protest and speak out when we see wrong being perpetrated. We anticipate and look forward to the day when the people in charge of CUC are sincere in their dealings and will not attempt to cause financial hardship to those who have the courage to question and object to the obvious and gross mismanagement of the utility. Maybe it’s time to give CUC its independence and allow Mr. Muna to run the agency to the best of his ability without reference to or dictates by the Administration.

Telesource’s dialogue with CUC about payment of outstanding invoices has come to a stop because CUC has again failed to live up to its promises. We are currently owed $829,420 and our letters of June 4 and June 12, 2008, notifying CUC that it is in breach of its contract with us have gone unanswered. As of this day Telesource can no longer purchase spare parts or other material required to operate the engines on Tinian. With over $829,420 owed to us let there be no mistake about why we are unable to procure lube oil to run the generators.

Without the courage to do the right thing the required change will never come to the CNMI. It is refreshing to know, however, that our people are waking up and the majority of our elected officials will not stand for this type of mismanagement any longer. Telesource for its part will be ready to assist in any way possible as long as transparency and fairness are the order of business.

Like every other company Telesource is going through hardship on Tinian. We have 20 MW of excellent fuel efficient generators but run only 4MW. We provide state-of-the-art efficient power to Tinian and meet or exceed all international standards. Yet we are treated by the CUC without any regard. This, however, will not deter us from standing ready to work with CUC on Saipan but only pursuant to reasonable and commercially sound business practices by all involved.

An atmosphere of fairness and reliability will create confidence in CUC’s creditors and will also allow us to attract outside investment and bring significant infusions of capital into the CNMI. Short of this, neither Telesource nor any other international firm will want to enter or expand its presence in the CNMI. This is simple 101 business practice and principles.