Tinian mayor, Finance at odds over $676K that went to CUC

Tinian Mayor Ramon Dela Cruz said yesterday the Department of Finance took $676,000.08 from his office’s account to directly pay their bills to the Commonwealth Utilities Corp. without consulting Tinian and leaving them with a negative account, especially ahead of the island’s fiesta.
Finance Secretary Larrisa Larson said last night, though, that they paid CUC “as directed by the expenditure authority.” Finance also said the Tinian mayor’s office’s three-month utility bills exceeded its budget for six months.

The Tinian mayor, however, believes that CUC’s “leaking pipes” are to blame for this, saying they continue to see high utility bills despite power and water use cuts.

For instance, the mayor said it is impossible for the Tinian gymnasium to “use” $108,008.13 worth of CUC water in a month even after closure of certain portions of the gym to conserve water.

The mayor’s office is therefore dealing with two issues—what it claims as Finance’s taking of funds from their account without consulting them, and the leaking and “antiquated” CUC water pipes that result in loss of water and bloated water billings.

As of yesterday, the mayor’s office has yet to receive a response from CUC executive director Allan Fletcher about the mayor’s request to send an engineer to check the water pipes and rectify the billings charged to the Tinian government.

Dela Cruz said Finance “took it upon themselves” to pay CUC the amount from the Tinian mayor’s office account “without rectifying accounts and leaving the mayor’s office of Tinian account with a negative $339,996.”

In a phone interview, Dela Cruz said his office discovered the amount taken from his office’s account on April 15 when they were about to pay for another service on Tinian.

“Money was not available anymore. We found out Finance obligated it to CUC. The Legislature gave me expenditure authority but it seems someone else took that authority away from me,” the mayor told Saipan Tribune.

Larson, in response to questions posed by Saipan Tribune to press secretary Angel Demapan, said the Tinian mayor’s office certified the bills that were submitted to her office for payment.

“We then paid as directed by the expenditure authority. …We didn’t take anyone’s funds. We used the funds allotted for CUC and then covered the remaining balance with the ‘all others’ portion of the budget. Every agency was given advice on the need to reduce power bills during the budget talks, the mayors’ council meeting and also after passage of the budget,” Larson said.

She said Finance pays CUC weekly, sometimes biweekly, depending on the bills submitted by agencies.

Larson said the municipality of Tinian submitted requests for payment of power bills from Oct. 1 through Dec. 31, 2013, during April 2014.

“The total amount for all three bills was greater than the budget allotted for the first two quarters of the fiscal year. We exhausted those funds and then had to use ‘all others’ to cover the shortfall. This language is included in the 2014 budget act and all departments and agencies were advised of this and encouraged to conserve power to prevent us from having to use their ‘all others’ budget to cover the shortfall,” Larson said.

The Finance secretary pointed out that the Tinian mayor’s office “is an exception” and it “went over budget for utilities in a significant amount.”

Dela Cruz’s office said that Finance’s direct payment to CUC using Tinian funds was done without consulting Tinian.

“This could not have come at a worse time, immediately before the Tinian Fiesta. Of course, the Fiesta will go on, but it has definitely hampered our ability to do all the cleanup projects we had scheduled. We do not know if this has happened to any other government agencies. Ever since the 2014 budget was adopted, we have worked at reducing water and power consumption. The increase in power rates did not help. Our problem is there is no engineer at Tinian CUC or within the Tinian Municipal Government to help us identify underground water leaks, the only reason for these outrageous water billings,” the Tinian mayor’s office said.

Rep. Lorenzo Deleon Guerrero (Ind-Saipan), chairman of the House Committee on Public Utilities, Transportation and Communications, said yesterday if it is indeed true that Finance “arbitrarily” took out funds from the Tinian mayor’s office account, that is “very questionable.”

But he said he has not heard whether other agencies or offices have had their funds used without their knowledge.

“It’s like an adult taking a boy’s candy,” the lawmaker said.

As for CUC’s leaking pipes as the Tinian mayor’s office claims, Deleon Guerrero hopes that CUC will send its engineer as the mayor requested, to help fix the problem and for the mayor’s office to be charged only for the actual water they were able to use.

Repeated requests to CUC

The Tinian mayor, in an April 28 letter to CUC’s Fletcher, said while most agencies on Tinian have been able to reduce power and water billings, they seem to be “trying to push water uphill with certain accounts.”

The Tinian gymnasium, under the Department of Community and Cultural Affairs, is just an example. In a January 2014 billing, Tinian gymnasium-DCCA had $108,008.13 for “water usage” and $7,399.45 in water electric charge. Other Tinian offices had water usage of between 54 cents and $407.25 in January 2014.

For February 2014, Tinian gym-DCCA’s water usage went down compared to the previous months but was still high at $21,122.70. For March 2014 billing, its water usage was $54,522.63.

Ana Marie C. San Nicolas, resident department head of DCCA-Tinian, told the Tinian mayor in an April 22 letter that they have followed instructions to cut utility costs.

“I requested CUC personnel to shut down my water system since last year and to open when it’s needed. Mayor, I just could not explain to you why I am still accumulating this much billing, but to simply say I probably have a major leakage underneath the gymnasium and cannot detect. I would like to work with Mr. Hall and have the CUC come in and locate exactly where the leaking area is at. I will continue to monitor my water billing and hopefully when funds are available, I would like to request for a major overhaul of my water pipes,” San Nicolas told Dela Cruz.

Meanwhile, the House Ways and Means Committee will be meeting this morning with the Finance secretary and other officials to discuss Gov. Eloy S. Inos’ proposed $134-million budget for fiscal year 2015, as well as his planned fiscal year 2014 supplemental budget.

Some lawmakers are hoping that the governor’s supplemental budget would also appropriate payments to CUC. The House PUTC chairman, for example, said $2 million to $3 million going to CUC would bring relief to CUC and its customers. But the governor said $5 million in the supplemental budget is for the retirement settlement trust fund and the rest is for the government’s health insurance premium payment.

Some government agencies such as the Public School System and the Commonwealth Healthcare Corp. owe CUC a total of over $20 million but PSS and CHCC are now working with CUC to settle the obligations