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    Monday, May 21, 2018-9:17:53P.M.

     

     

     

     

     

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IT&E questions legality of Docomo-NMI MOU

IT&E is questioning the legality of the memorandum of understanding signed by Docomo Pacific and the CNMI government as well as the funding measure that appropriates $1.3 million to subsidize the installation of  Docomo Pacific’s fiber optic cable for Tinian and Rota.

James Oehlerking, IT&E CEO,  is seeking a legal opinion from the attorney general on whether the MOU is legal and binding and whether the funding measure, House Bill 20-164, is legal as well.

In his letter to AG Edward Manibusan, Oehlerking said neither the bill nor the referenced MOU identify any existing CNMI law or grant program which authorizes the use of CNMI taxpayer funds for such private projects.

James OehlerkingJames Oehlerking

“Nor do we believe such use of public funds to be rational,” the Oehlerking said.

“We understand the government’s desire to increase infrastructure and support private investment, [but] if it was the government’s intent to facilitate such investment, it should have requested legislation authorizing the use of such funds and identified a procedure pursuant to which other telecommunications carriers would have the opportunity to compete for such funds,” Oehlerking added.

“Such procedures would put everyone on a level playing field and would promote even greater investment.”

He said the Federal Communications Commission has developed detailed laws and regulations identifying the availability of such funds and specifying how grantees may apply for and use such funds.

He said when the U.S. Department of Commerce did a similar thing and distributed grant funding under the Broadband Technology Opportunities Program to help bridge the technological divide, create jobs, and improve education, healthcare and public safety in communities across the nation, it developed an open and transparent process for companies to apply.

“It is unclear to us why a similar process was not followed in this particular situation,” Oehlerking said.

He said when they invested in the commonwealth, they invested equally on all three islands. IT&E is in the process of upgrading its cable and microwave backup systems without CNMI taxpayer funds, he added.

“We would welcome the opportunity to compete for funding from the CNMI in support of our operations should such funds become available in the proper process.”

He said lacking any apparent valid legal foundation, House Bill 20-164 and the MOU did not offer any public benefit for the taxpayer expenditure other than to provide a non-competitive subsidy to one of the largest telecommunications providers in the world.

“Other than some vague general-interest argument, there is absolutely no public benefit justification offered for this corporate subsidy and the government and taxpayers are getting nothing in return. In light of all the other pressing financial needs of the CNMI, it would seem inappropriate for the government to support such a corporate handout,” Oehlerking said.

He said without specific statutory authority for the use of funds, they believe that the MOU and the funding bill are without legal authority.

“Putting aside whether such subsidy is legally permissible, it is poor policy, both as a matter of reasonable use of limited taxpayer revenues and as a fundamental matter of fair-competition policy,” he added.

Sen. Jude Hofschneider, during a session on Wednesday, asked the Senate legal counsel to look into IT&E’s concerns and the legality of the MOU.

 H.B. 20-164 is now with a bicameral conference committee after the House rejected the Senate amendments to the bill.

The House conferees are Reps. John Paul Sablan, Joseph Deleon Guerrero and BJ Attao while the Senate conferees are Sens. Judge Hofschneider, Justo Quitugua and Teresita Santos.

Senate President Arnold Palacios asked the Senate conferees to settle the issue as soon as possible.

For his part, Rep. Angel Demapan introduced House Bill 20-165 to appropriate $7 million for mold remediation and a new air-conditioning system for the judiciary and $1.3 million  for the Tinian and Rota fiber-optic cable.