SAIPAN — Representative Vincent R. Aldan said the Commonwealth Utilities Corporation’s court-ordered status report shows why his ratepayer-protection bills are needed, arguing that the utility’s long-running compliance problems cannot be addressed by ordinary annual financial audits.
In a public statement, Aldan, chairman of the House Committee on Transportation and Infrastructure, said the report confirms that CUC continues to report unresolved issues nearly two decades after the 2009 federal stipulated orders, including problems with drinking water, wastewater, management structure, finances, capital planning, procurement, asset management, water losses and oil-related corrective action.
Aldan said a financial audit shows whether financial statements are presented a certain way but does not verify whether CUC’s assets are confirmed, whether procurement and contracts are controlled, whether fuel and pass-through costs are prudent, whether billing and collections are accurate, or whether ratepayers are protected from management failures.
Citing the report, Aldan said CUC’s non-revenue water stands at about 55 to 56 percent, that the comprehensive water and wastewater master plan remains ongoing, and that the Commonwealth Healthcare Corporation still owes roughly $30 million in arrears that would take about 17 years to pay off at the current rate. He said the report also describes continuing issues under Stipulated Order No. 2 involving oil, contamination and corrective action.
Aldan said the findings support three measures. He said House Bill 24-88 would require a comprehensive independent utility expert audit examining billing accuracy, collections, procurement, contract administration, inventory, fuel cost pass-throughs, asset verification, water losses, reliability, internal controls and ratepayer impacts.
He said House Bill 24-87 would require that any major CUC contract, private-sector agreement, concession, independent power producer agreement, public-private partnership or privatization-related transaction be subject to independent valuation, competitive procurement, Office of the Public Auditor review, Commonwealth Public Utilities Commission review and public transparency. He said House Bill 24-59 would establish fair billing rules and protect residential ratepayers and small businesses from abusive back-billing.
“This is not about punishing CUC,” Aldan said. “This is about protecting the people who pay the bills.”
Aldan said ratepayers should not be asked to pay more until CUC proves through independent review that its costs are accurate, its assets verified, its contracts controlled and its rate requests justified. He said that if lawmakers have concerns with the bills they should amend or fix them, but that tabling the legislation with no timeline protects the status quo.
The statement comes the same day the Senate rescheduled its Fourth Special Session to June 24. The independent valuation and audit bills Aldan referenced are not listed on that session’s agenda.