Injunction eyed vs CUC genset

Rep. Edwin K. Propst is thinking of suing the Commonwealth Utilities Corp. board to stop it from going through with a plan to buy a new diesel generator.

Propst (Ind-Saipan) told Saipan Tribune yesterday that he would be filing an injunction against the CUC board’s plan and he hopes that Attorney General Edard Manibusan will agree to file it.

Propst said that he has already met with Manibusan, who agreed with him about the need to investigate the matter.

“I already had a meeting with Attorney General Ed Manibusan about my concerns this afternoon. I expressed to him my concerns and I told him I would be writing a formal letter and I would be [furnishing] the Office of the Public Auditor [with a copy of the letter]. I want this investigated and looked into. We need to be very careful that we scrutinize this deal that has been made. [CUC] has been very secretive about this and it is time to shed some light on it,” he said.

Propst assured that he will do all within his means to prevent the contract from going through. He described the contract as highly questionable and suspicious. “There are a lot of red flags.”

If he will need to hire his own attorney, then he would do so. “This is not the way we are supposed to conduct meetings: rush through with an RFP [request for proposals] or use an emergency as the reason to purchase something so swiftly and expeditiously that there is no due diligence,” he added.

Propst does not believe the process of procuring the new 8 to 10-megawatt generator has been in the works for some time. According to a source at CUC, the process did not go through the corporation’s Procurement and Supply Division; it was “upper management” that handled the project.

Propst tried to obtain a copy of the request for proposal on the generator via an Open Government Act filed yesterday at about 2pm but “I still haven’t received what I asked for, because it has to get approval from the legal counsel. Anyone should be able to get, at the very least, the request for quotation because that is public knowledge, that is a public document. Anybody could have applied for this RFP. Why did I not receive it yet? Are they stalling? Are they afraid I am going to uncover something?” asked Propst.

He recounted that during yesterday’s CUC board meeting, discussion on the financing of the generator purchase was put under executive session, resulting in Propst being asked to leave. That only made him more suspicious about the transaction.

“I question them about the legitimacy of having an executive session to discuss the financing of the generator. I stated that it should be made public. I guess they didn’t agree with me and went into a secretive executive session to discuss the financing of this generator,” said Propst.

Propst’s main concern with the procurement was the process and CUC’s “questionable rush” to procure a generator based on the quotation of General Pacific Services Marianas Inc., or GPSM, represented by Amelia R. Toelkes, along with GPSM business partner, Fairbanks Moores.

Amelia Toelkes is the wife of Robert Toelkes, who is currently a defendant in the M/V Luta case filed by Japanese investor Takahisa Yamamoto.

Robert Toelkes’ company in Guam, International Bridge Corp., filed for bankruptcy last year and failed to finish its project at the Guam JFK High School, another aspect that furthers the lawmaker’s suspicion.

“I asked [CUC] several questions [yesterday], and they didn’t answer any of them and basically got upset with me because they claimed I didn’t attend enough meetings and that this is my first time to attend the meeting, which is besides the point,” said Propst.

CUC board pushes through with genset purchase

After an executive session discussion on financing the generator purchase, a decision was made by the CUC board yesterday to push through with the procurement.

Despite the many unanswered questions surrounding the procurement, CUC board member Eric San Nicolas justified the purchase and the procurement process, even referring to the latter as “open and transparent, contrary to what Mr. Propst said.”

According to San Nicolas, the board decided to proceed with the emergency procurement after declaring an emergency within the board.

CUC was recently informed by Imperial Pacific International that their energy consumption would increase by 5 megawatts come the end of the month. According to San Nicolas, CUC board member Joe Torres was approached by the resort about the additional power demand.

“We made a declaration of emergency on the board, so that would allow us to go through the emergency procurement process for this particular engine because of the power needs of Saipan, especially with Imperial Pacific Resort and everything coming up. We just heard from director Joe Torres that IPi demand goes up by 5 megawatts next month, and the expectation is that it would just keep going up as time passes,” said San Nicolas, justifying the emergency purchase.

“We do not have the engines needed to support [the additional demand],” he added.

San Nicolas also pointed out that CUC’s generator 8 has not been functional for about eight years.

The new diesel generator would cost a little over $11.7 million—money that San Nicolas said CUC has after receiving payments from government agencies, including the payments of the central government and the Public School System.

“We have verified with the CUC chief financing officer that we have the funding to procure one now. This drastically shortens the time, which is justified by the emergency,” he said. “We are looking at the soonest possible option.”

The CUC board also voted to produce a negotiating committee for the generator, composed of CUC board chair Adelina Roberto, along with other members of her choosing.

Once negotiations have been finalized, Roberto, who has been authorized by the CUC board, would then approve the purchase process.

“At the end of the day, the goal is to replace engines. Saipan engines are in need of replacement,” added San Nicolas.