THE Department of Public Works said the Commonwealth Utilities Corp. should pay $9.6 million in fines and civil penalties for the incomplete restoration of public roads that CUC's Water Division cut and trenched for pipe repairs and maintenance.
CUC, however, has questioned the legality and accuracy of DPW’s notice of violation.
In a July 28, 2023 letter to acting CUC Executive Director Betty Terlaje, George C. Sablan, the acting director of DPW’s Technical Services Division, said they had determined that the restoration of roads after CUC's road cuttings and trenching was not completed.
These road cuttings and trenching activities were done without required permits, Sablan said.
He noted that a total of 110 applications for road cuttings have been approved after CUC was issued a notice of violation on Sept. 21, 2022, pending the restoration of the asphalt pavement of roads throughout the island.
Sablan said CUC should pay the fines and civil penalties to the CNMI Treasury.
In an interview on Friday, Terlaje said CUC is going to contest the numbers in the DPW notice of violation because “we feel they are not accurate and reflective of what really transpired with the road cuttings.”
She said they are also looking at the legality of some of DPW's claims.
Terlaje said DPW knows that CUC cannot repair the roads immediately, which is why the Water Division resorts to other remedies. “They are penalizing us for doing the right thing,” Terlaje said, referring to DPW.
“I want to give the [DPW] secretary the benefit of the doubt that he is a reasonable person to come and speak with us and perhaps this is just a notice that we've got to start complying quicker,” Terlaje said.
When DPW first raised the issue in April 2023, then acting CUC Executive Director Dallas M. Peavey Jr. told the department to pay its $1.1 million outstanding balance in utility bills.
In a letter to DPW Secretary Ray N. Yumul dated April 19, 2023, Peavey said his priority was to fulfill CUC obligations “despite blatant refusal of DPW and other government agencies at performing their contractual and fiduciary responsibilities,” referring to the government’s unpaid utility bills.
On April 24, 2023, Peavey was "terminated for cause."
As of May 2023, the CUC board said the government owed the public utility over $59 million in unpaid utility bills.
