Propst: Another questionable purchase

House minority leader Rep. Edwin K. Propst (Ind-Saipan) is again asking the Commonwealth Utilities Corp. to explain why an emergency purchase contract was awarded to a winning bidder that was connected to a similar deal that raised a lot of red flags almost two years ago.

Propst told Saipan Tribune that International Bridge and Construction Marianas Inc. was the winning bidder for a generator that will be shipped and installed on Rota, where the CUC board of directors had declared an emergency to create reserve power.

Saipan Tribune called CUC executive director Gary Camacho to get more details on the issue, but he did not reply.

IBCMI, which is based in Yigo, Guam, is owned by a William Toelkes, whose son, Robert Toelkes, is the husband of Amelia R. Toelkes, who was implicated in a questionable generator purchase deal between CUC and General Pacific Services Marianas Inc.

Amelia R. Toelkes was the GPSM president that was awarded the contract by CUC in purchasing an 8- to 10-megawatt diesel generating system. Robert Toelkes has his own company, International Bridge Corp., but has filed for bankruptcy a few years ago.

Robert Toelkes’ company failed to finish a project awarded to it at the John F. Kennedy High School in Guam and was also implicated in the M/V Luta controversy as he was listed as one of the defendants in a case filed by Japanese investor Takahisa Yamamoto.

Propst said that CUC first awarded the contract to another company, but Robert Toelkes protested and the CUC selection committee changed its decision and chose IBCMI. “Why give the contract to a company with a guy that’s connected to a questionable deal?” asked Propst. “A deal that led to the removal of the CUC board members and investigations by the Attorney General, the Office of the Public Auditor, and the Federal Bureau of Investigation. I don’t know if the [request for proposal] is still under investigation.”

He said that, similar to the previous issue with GPSM, he is again concerned with the contract. “The guy [Robert Toelkes] has returned. CUC should have the right to refuse and block him from joining any bidding.”

“Some of us in the Legislature would continue to be the watchdogs of the CNMI government, especially if it involves the taxpayers’ dollars. They had declared an emergency situation, but that does not bother me. Rather, it is the generator purchase deal.”

Propst said the emergency situation is also for reserve power, yet Rota uses only less than 2 megawatts of power. He added that he got information that the Matsui engine is expected to be repaired in the first week of March that guarantees an additional 2.5 megawatts.

“Rota Resort also has three 1MW engines that has more power to provide for Rota. The public doesn’t know anything about this. And for what I’ve heard, they purchased a used generator. This will be passed on to us CUC ratepayers,” said Propst.

“Even the shipping cost and the operation of a crane to unload the generator, it will cost thousands of dollars. The contractor should shoulder this and not CUC’s customers to be billed. There are a lot of things that’s not right with this deal.”

He called for further investigation and scrutiny of the deal. “I am pleading with the AG not to sign the emergency purchase until further review is done. We have a lot of questions, like why was the purchase necessary? What’s the going rate for a brand new or used generator? Why the rush? Rushing this contract is very disturbing.”

“Who are the people involved in the deal and making money out of it? I hope the House and Senate [Public Utilities, Transportation, and Communications] chairs would investigate or call CUC about this and get more information about the deal.”

Senate PUTC report

Camacho, in his report to the Senate PUTC Committee meeting last Tuesday, said the 2MW unit is currently meeting the power demand in Rota, but the problem is the reserve capacity after the Matsui engine No. 2 encountered problems last month.

“It turns out it has reduced the reserve capacity to what it is today. But, our crews and specialized personnel were sent out immediately. More have been added since to start removing the generator.”

“And the damage to that Matsui is on the generator side, not mechanical side, so the generator was moved from one unit to the other unit because both are identical. And being transferred over, that project should be finished on March 3, then we would anticipate—from what I understand with my conversation [with people involve]—we will have the 2.5MW back in reserve capacity.”

He said that the board also approved the emergency procurement of a CAT generator and they anticipate the shipment to arrive anytime this week. “Although there’s a crane issue on Rota. The contract states that there’s a way to resolve that and we will be able to get it on the island.”

“[The purchase] will add another 2MW. Although [Rota’s] peak demand is from 1.5MW to 1.8MW, it will bring the reserve capacity at that point to near 8.5MW, with the peak demand of 1.8MW.