Palacios is optimistic that CUC, CHCC will resolve arrears issue

Gov. Arnold I. Palacios is optimistic that the Commonwealth Utilities Corp. and the Commonwealth Healthcare Corp. will reach a mutually agreeable plan to prevent the disconnection of the hospital’s power and water services by May 4, 2023.

This comes after CUC served notices of disconnection to CHCC and Department of Public Works Wednesday last week due to unpaid power and water services amounting to $53.6 million and $1.12 million as of March 31, 2023, respectively. CHCC and DPW were given 14 days or until May 4 to pay or settle.

In response to Saipan Tribune’s inquiry Monday, Palacios confirmed that he and Lt. Gov. David M. Apatang met with CUC and CHCC officials in the governor’s conference room last week, Tuesday, to attempt to resolve the issue.

The governor said they respect the autonomy of the two agencies, but strongly instructed them to resolve CHCC’s non-payment of utilities immediately because they are talking about the hospital.

Palacios said that CHCC’s arrears are a recurring issue and there had already been a previous lawsuit involving the two agencies. He said the court basically instructed CUC not to cut the power off at the hospital, but that also placed CUC in a quandary, since it has to deal with federal court-stipulated orders and other issues with the federal government, such as Environmental Protection Agency, that mandated it to implement certain projects.

Arnold I. Palacios

Palacios said they instructed officials of both agencies to come up with a plan that is mutually acceptable and agreeable

Palacios said he, in fact, had just talked with CUC board chair pro tem Janice A. Tenorio that morning, Monday, April 24, and that he understands that CUC is having some meetings and that he insisted on being briefed by the end of the day or the following morning on their decisions to address this issue.

Tenorio wrote a letter that same day, Monday, to Palacios and Apatang informing them that she had terminated acting CUC executive director Dr. Dallas M. Peavey Jr. for cause.

Palacios said he and Apatang are reluctant to insert themselves into the autonomy of CUC and CHCC, which are both revenue-generating agencies.

“Obviously we want them to resolve this issue,” Palacios said.

The governor said they had about an hour-and-a-half discussion with CHCC and CUC that day, Tuesday, last week. He said he walked out of that meeting very hopeful that CUC and CHCC will resolve the issue.

However, Palacios said, he read in the paper last Thursday that CUC had issued a disconnection notice to CHCC a day before, or Wednesday. “And I hope they will go back to the table and come up with a plan on how to resolve this particular issue,” he said.