CUC ‘not receptive’ to 45-day extension sought by PSS

The Commonwealth Utilities Corp. is not receptive to the Public School System’s request that it be given a 45-day extension to come up with a payment plan for its longstanding arrears to CUC.

CUC board chair David J. Sablan told Saipan Tribune yesterday that the extension is unnecessary since PSS already has in its books and records how much it owes the utility agency.

“I am not necessarily agreeable to that [45-day extension request]. I just want to know right now how they’re going to pay their old debts with CUC. That should be simple enough to tell me, based on their financial situation,” said Sablan, after a meeting with Commonwealth Healthcare Corp. officials yesterday morning.

CUC wrote the Board of Education on April 23 demanding that public schools submit a meaningful payment plan within 15 days or else CUC may be forced to disconnect schools due to its mounting utility debts.

It was disclosed that the total past due balance owed by PSS to CUC is $7.18 million. This balance represents a principal amount of $6.38 million for electrical, water, and wastewater services and accrued late charges of $807,558. Late charges continue to accrue at the rate of 1 percent per month pursuant to CUC regulations.

Sablan earlier indicated that this PSS debt represents 31 percent of CUC’s total receivables from government customers and about 26 percent of receivables from all customer classes (residential, commercial, and government accounts).

Two days later, on April 25, BOE chair Herman T. Guerrero responded to CUC’s demand letter, asking for a 45-day extension.

Sablan pointed out, however, that PSS receives its bill every month and “surely, there’s somebody in the organization that is tallying that amount.

“Frankly, they have known about their past due accounts to CUC. And I don’t know why it would require 45 days to develop the plan on how they’re going to pay for the old debts,” Sablan added.

The CUC chairman said that PSS, which receives appropriation from the Legislature, could address its old accounts with CUC.

“PSS gets appropriation from the Legislature. Request for the right amount to pay utility bills…and we’d all be okay,” he said.

Sablan was scheduled to meet with BOE’s Guerrero yesterday afternoon to discuss the issue.

As for what he expects from this meeting, Sablan replied: “The only thing I am looking for is: tell me how you’re going to pay the old debts. I am not looking for sad stories because it doesn’t concern CUC. We just need to know clearly how they’re going to address that.”

Sablan admitted that CUC earlier rejected the memorandum of understanding inked by PSS and the central government, which targets to assign and offset a portion of PSS’ debt.

“Why don’t they collect and pay us instead? If C owes B and B owes A, why you’re telling A to go and collect from C?” he asked.

CUC has already filed a lawsuit to collect on PSS’ arrears. Sablan earlier said that CUC is willing to delay the collection lawsuit if a “realistic” payment plan will be presented by the school system.

However, failure to make arrangements for payment of this amount within the next 15 days will leave CUC with no alternative but to consider further action, including but not limited to disconnection of services.