‘Gov’t drowning in financial deficit’

Senate President Edith E. DeLeon Guerrero (D-Saipan) said yesterday that the CNMI government is in a deep financial deficit and utilities is one of its greatest expenses to maintain operations.

DeLeon Guerrero said any effort to save energy cost helps, but as a unit of government, they must explore opportunities to drive down the costs of utilities.

The Senate president discussed the government’s unpaid power and water services in response to Saipan Tribune’s request for comments about the Commonwealth Utilities Corp.’s issuance of disconnection notices to government agencies, including to the Legislature Bureau.

CUC has given the Legislative Bureau only until May 18, 2023, to pay its accumulated outstanding balance in the amount of $38,487 over several delinquent utility accounts as of March 31, 2023.

In his response to CUC’s disconnection notice, Legislative Bureau director Perry John P. Tenorio said they aim to settle all arrears by the May 18 deadline.

DeLeon Guerrero said yesterday that she has been working closely with Tenorio to look into alternative sources of energy.

“We have begun the requests for quotes on this,” said the Senate president, adding that they will pursue funding opportunities from federal grants to achieve this effort.

Meanwhile, the Legislative Bureau is working on its backup generator project, DeLeon Guerrero said.

While looking into alternative energy, they must also simultaneously utilize their legislative oversight powers to address the serious financial dilemma the government is in, she said.

The Senate president said the government’s deficit is more than 150% of their prior total local revenues and prior to the COVID-19 pandemic revenues.

“This is very scary and not good financial management of our government,” DeLeon Guerrero said.

On Aug. 3 last year, the Saipan and Northern Islands Legislative Delegation’s Judiciary and Governmental Operations Committee, which DeLeon Guerrero had chaired, met with CUC duriung which they discussed various questions and concerns that the committee had regarding the Fuel Adjustment Charge.

As a result of that meeting, the committee recommended for CUC to fully disclose all the items such as bad debt and volatility rates that are included in the rate review to the Commonwealth Public Utilities Corp. so that paying customers are fully aware of what and why they are paying so much.

The committee report recommended that CUC review the cases of businesses and private residents on a case-by-case basis so that financial promises can be filled without disconnection of utilities.

The report recommended for CUC to use energy futures market or fuel price method program to reduce the price risk swings in world oil markets, essentially safeguarding CUC customers from the inherent volatility of fuel prices and to contact other jurisdictions that hedge their oil such as American Samoa and Palau to see how they do it.

The committee report also recommended for CUC to consider eliminating the $7 monthly customer charge and to place their customer security deposits into an account that has a higher yield.