CHC’s Muña, CUC’s Sablan face off

Commonwealth Healthcare Corp. chief executive officer Esther Muña and Commonwealth Utilities Corp. board chair David J. Sablan took the witness stand yesterday as the legal battle between the two agencies continues in Superior Court.

Assistant attorney general David Lochabay, counsel for CHCC, presented Muña as a witness to support CHCC’s motion for preliminary injunction that seeks to prohibit CUC from disconnecting electric, water, and sewer services to the Commonwealth Center Center, which CHCC runs.

James Sirok, legal counsel for CUC, called Sablan to the witness stand to support CUC’s opposition to the motion for preliminary injunction.

When Saipan Tribune left the courtroom late afternoon, Sirok had just called CUC’s next witness, Dan Jackson, who is CUC’s rate consultant from economist.com.

Associate Judge David A. Wiseman presides over the hearing. Last week, Wiseman granted CHCC’s request to issue a temporary restraining order against CUC.

In granting the TRO, Wiseman said the hospital would suffer immediate and irreparable harm should CUC disconnect any of its utility services as CHC would become unable to provide critical healthcare and public health services.

CUC has threatened to disconnect unspecified utility services to the hospital due to CHCC’s outstanding utility bills.

Lochabay said they don’t deny that CHC owes CUC a big amount but the hospital would suffer immediate and irreparable harm if CUC disconnects any of its utility services. He cited, among other things, that if disconnected of power, the doctor service in the hospital will be disrupted.

Sirok said the court has no jurisdiction over CHCC’s complaint because administrative remedies have not been exhausted; that CUC has a legislative mandate to disconnect; and that CHCC has the opportunity to do something about the arrears other than going to court.

Citing laws and regulations, Sirok said all customers with past due bills are subject to disconnection of utility services.

When called to the witness stand, Muña testified about, among other things, CHCC’s budget, cash flow report, and personnel costs. She explained the impact on CHCC’s public and administrative services if electric services are turned off.

Muña admitted that, lacking a sufficient budget, CHCC paid only about 28 percent of its utility billings in 2013 and 22 percent so far in 2014.

Muña said CHCC came up with a payment plan but that, in a meeting with Sablan, he was yelling and telling them what to do.

Sirok mentioned that Sablan gave Muña three months to come up with a realistic payment plan and that he indicated that it is not a total disconnection of utility services to CHCC, to which Muña said, “Yes.”

Muña said CHCC is going to pay its bills and in fact they actually offered an amount that, in their opinion, was appropriate based on their cash flow and more than they consume in a month.

It was reported that CHCC offered to pay $325,000 for its monthly utility consumption, but CUC rejected it as CHCC’s average consumption is about $540,000 a month.

Muña said their generator is only for emergency purposes. She also cited that they are implementing a “power watch,” checking the air-conditioning systems, and applying for grants to have more energy efficient equipment.

Sablan testified that he gave CHCC a conservation plan, which needs input from CHCC. He said it is up to the hospital to decide what conservation measures to implement if they want to avoid being disconnected.

“We’re not inhumane. We have to help them conserve. That’s what I advised Muña and two board members,” he said.

Sablan said he has not seen in writing CHCC’s conservation measures.

He said there is no CUC policy that provides free utility services to customers, including CHCC.

In December 2013, CUC filed a lawsuit against CHCC to collect utility services in the amount of $9,690,875, together with pre-judgment interest. It was last reported that the hospital owes CUC $11 million in past due accounts.