Judge OKs $924,275 in payments for some delayed CUC projects

The federal court has approved a joint request filed by the U.S. government, the CNMI government, and the Commonwealth Utilities Corp. for partial and full payments totaling $924,275.40 to Gilbane Federal for its costs incurred for performing some stalled CUC projects.

Gilbane Federal is a California-based construction company selected by the federal court as the Engineering and Environmental Management Company that will have the power to expeditiously complete some CUC projects.

U.S. District Court for the NMI designated Judge David O. Carter approved the joint stipulation that seeks payment for EEMC invoices incurred through Aug. 31, 2015.

U.S. Department of Justice Environmental Enforcement Section senior attorney Bradley R. O’Brien signed the stipulation on behalf of the U.S. government. Attorney James S. Sirok represented CUC, while assistant attorney general Teresita Sablan signed as counsel for the CNMI government.

With Carter’s order, the EEMC will be paid $132,555 pursuant to Task Order 1 for EEMC activities such as providing construction management, oversight, and court required activities.

With the judge’s approval, the EEMC will be paid $336,730 pursuant to Task Order 2 for EEMC activities relating to the CUC pipeline project.

O’Brien, Sirok and Sablan said the U.S. government and CUC are continuing to discuss the EEMC Task Orders 1 and 2 funding request and reserve all rights to contest payment of those funds.

The lawyers, however, agree that the EEMC shall be paid $132,555 and $336,730 in “good faith” prior to reaching a final resolution of Task Orders 1 and 2 costs incurred through Aug. 31, 2015.

With Carter’s approval, the EEMC will also be paid $375,000 pursuant to Task Order 3 for activities relating to Tank 102. This payment will fully satisfy all Task Order 3 expenses incurred by the EEMC and no further Task Order 3 payments shall be made. As a result of the full payment, the EEMC will not incur or seek additional expenses associated with Task Order 3, which will then be terminated.

Finally, the EEMC will be paid $79,990.40 pursuant to Task Order 4 for EEMC activities relating to CUC facility drainage. The payment will fully satisfy all Task Order 4 expenses incurred by the EEMC though Aug. 31, 2015.

Carter also granted the parties’ request to modify previous court order to allow the EEMC 20 days after each month to file with the court and to preserve the parties with an invoice of the EEMC’s expenses incurred during the preceding month.

Last February, Carter approved CUC’s request to deposit $300,000 in court and allow Gilbane Federal to perform construction management for CUC’s Tank 102 project.

The Tank 102 project involves a 500,000-gallon diesel fuel tank that will replace Tank 010, which has been found to be a source of pollution and is unrepairable.

The U.S. government, the U.S. Environmental Protection Agency, and the CNMI government did not object to CUC’s request to allow Gilbane Federal to perform Tank 102 activities.

CUC counsel Sirok stated in their request that the utilities agency shall be solely responsible for funding Gilbane’s task order activities.

Last Jan. 12, Carter clarified that Tank 102 remains the responsibility of CUC, including CUC’s obligation to fund and construct the tank.

Sirok said the $300,000 will be withdrawn from the contingency fund being maintained by CUC.

Upon completion of task orders and after full payment is made to Gilbane, funds remaining from CUC’s $300,000 court registry deposit shall be returned to CUC.