Central govt pays PSS’ $50,000 utility obligation

The central government and the Commonwealth Utilities Corp. appear to have reached an agreement over the Public Schools System’s unpaid utility billings after the Fitial administration paid $50,000 in PSS arrears and promised to pay for the balance in a year.

CUC chief financial officer Charles Warren confirmed with Saipan Tribune yesterday that the $50,000 is a down payment on the $1.7 million obligation that the central government has agreed to absorb out of the $3 million total that PSS owes CUC.

The central government agreed to shoulder the $1.7 million as acknowledgment that it failed to remit PSS’ budget allotments last fiscal year.

Warren said that CUC received the amount on Nov. 15, along with a pledge that the remaining balance of $1.6 million will be paid within the next 12 months.

PSS, meantime, will shoulder the remaining balance of $1.3 million, Warren said, and he expects the obligation to be paid off within the same time frame.

“The $3 million obligation of PSS to CUC was as of Sept. 30. We just met and arranged with PSS and the central government the payment plan. The central government will pay $1.6 million and PSS will pay $1.3 million,” he said.

CUC earlier rejected this arrangement as proposed by CUC and the Fitial administration, citing the lack of a concrete payment schedule.

CUC officials said yesterday that a new agreement is now being drafted to reflect this setup. CUC legal counsel Deborah Fisher even asked the Commonwealth Public Utilities Commission to provide CUC some direction on the issue. She said it is the intent of CUC to continue negotiations with the central government relating to PSS’ obligation.

CPUC chair Viola Alepuyo earlier slammed CUC officials for their unfair treatment of customers by allowing paying patrons—poor residential customers and commercial businesses—to subsidize the shortfall of delinquent customers such as PSS and the central government and by letting them be reconnected without paying a single penny—a violation of CUC policy.

As of Sept. 30 this year, Warren said that the central government and PSS top the list of accounts with unpaid obligations. He said the central government has an outstanding debt of $2.4 million while PSS owes $3.6 million as of end of fiscal year 2011. With the recent payment of $50,000, PSS’ obligation now goes down to $3.1 million.

The $6 million collectible from PSS and the central government translates to a month’s supply of fuel for CUC.

CUC buys fuel every other day and pays $1.5 million weekly for it.