CUC senior management and CPA reps finalizing agreement

The senior management of the Commonwealth Utilities Corp. is reviewing and working with representatives of the Commonwealth Ports Authority to finalize an omnibus settlement agreement the two agencies drafted to finally resolve the many issues that they have had for many years.

Those issues relate to utilities and water charges, as well as easement and access/right to use.

In an interview, CUC executive director Gary P. Camacho said the omnibus settlement agreement, which was among some topics being discussed during the CUC board’s executive session last Friday, is something that they want to get resolved quickly.

He said there are scenarios that they need to finalize and some conditions that CPA expects from CUC.

Camacho said they are working on finishing those items very quickly and get that back on the table by the next CUC board meeting. No schedule has been set yet for the next CUC board meeting but he said CPA agrees with the conditions.

“We will finalize the documents very quickly. We like to get this [agreement] done by the next board meeting,” Camacho said.

Last June 18, CPA board approved the draft CUC-CPA omnibus agreement with some conditions.

Part of the agreement would give CUC permanent easement for usage and access to: 67 water wells on CPA premises; the existing CUC water line transporting the water from the well to the CUC island system; CPA’s 20-million-gallon water tank; and the CUC sand filtration system on CPA premises.

Under the terms of the agreement, CUC has the responsibility to maintain the water wells easement.

This will provide CPA with continuous water supply from the water resources on its (CPA) premises free of charge.

CPA, however, upon execution of this agreement, will pay for sewer line charges at an established flat rate.

CPA board chair Kimberlyn King-Hinds earlier stated that this omnibus settlement deal will resolve the specific charges that have been an ongoing dispute between CUC and CPA.

This agreement would basically provide an offset of charges, said King-Hinds, noting that CPA will pay CUC the sum of $7.2 million as a settlement amount for the disputed water charges and penalty.

“This same amount shall be the amount of consideration for the easement agreement that we will be executing with CUC,” she said.

King-Hinds said the issue with the Saipan seaport wharfage fee is fully resolved by executing this agreement.

She said they, however, have accounting issues that they need to address so that they can allocate this back billing at the correct fiscal years so that it doesn’t impact their bond and insurance agreement.

King-Hinds said that, with the CPA board’s approval, the agreement will then go to the CUC board for final approval.

She said the Commonwealth Public Utilities Commission is also required to approve it.

CUC last reported that CPA’s debt to CUC now stands at $17.7 million.