Mayor’s Office still paying $50K owed from 2008

In order to fulfill requirements for its annual budget appropriations, the Saipan Mayor’s Office needs to pay off its outstanding debt from 2008 totaling more than $50,000.

Mayor David Apatang earlier disclosed that the Mayor’s Office is still paying over $50,000 in past arrears that former mayor Juan B. Tudela and his office incurred after they failed to pay a company for providing services in connection with the 2008 Liberation Day festivities.

Apatang told lawmakers he needs his $3.06-million proposed budget in order for his office to meet full requirements.

Rep. Felicidad Ogumoro (R-Saipan) earlier asked Apatang if a portion of the fiscal year budget for 2015 was used to pay prior debts, to which Apatang and his staff said yes.

If the Mayor’s Office fails to settle this debt, it will then continue to accrue a post-judgment interest rate of 9 percent each year, Apatang said.

Court records obtained by Saipan Tribune show that Kwun Kee Co. Ltd. had sued Office of the Mayor of Saipan for breach of contract after it failed to pay for the construction of 30 booths used during the 2008 Liberation Day festivities.

The company was supposed to be paid $650 per booth, for a total of $19,500. It also included a 20-to 30-minute fireworks display totaling $24,983. However, the fireworks toppled over and caused chaos and injury during the festivities.

It totaled $44,483, prior to the judgment against the Mayor’s Office in 2010. Tudela paid some $12,000 of the judgment.

Seeking clarification, Mayor’s Office special assistant Henry Hofschneider said the judgment was based on Kwun Kee’s involvement after taking legal action against the Mayor’s Office in 2008.

In 2010, the judgment entered was $32,583, after $12,000 some was paid.

Hofschneider said that Kwun Kee now seeks full payment of the outstanding balance under the judgment, which includes post-judgment interest at the rate of 9 percent per annum on the principal amount of $31,583 that is due.

“Since post-judgment interest rate from 2010 accumulated until 2015, it increased the $32,000 to $50,000,” he said.

“Former mayor Marian Tudela and Mayor Apatang paid close to $12,000 for the interests rates only; the principal amount is still there,” he added.

During the budget hearing, Apatang said so far they have paid a total of $12,500 up-to-date for the judgment fee.

“Instead of paying that 9 percent additional interest, we can pay that off with our requested budget. It will save us a lot of money and we have discussed this with the individual, and he is willing to accept the principal amount of some $32,000 so it could be settled and we would not be paying it again,” Apatang said.