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Last updateTue, 27 Aug 2019 12am







    Monday, August 26, 2019-6:38:40P.M.






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Judge orders clarification of Gilbane Federal’s tax issue

FEDERAL Judge David O. Carter of the District Court for the NMI ordered the Commonwealth Utilities Corp. and the CNMI Department of Finance to determine if gross receipts tax applies to CUC projects handled by Gilbane Federal, CUC’s federally designated engineering and environmental management company or EEMC.

Finance’s Division of Revenue and Taxation has indicated that GRT may be applicable to EEMC projects.

David O. Carter

For this reasons, Judge Carter said the combined $10,424.99 GRT line items were deducted from EEMC’s invoice payment.

Bradley R. O’Brien, senior trial attorney of the U.S. Department of Justice- Environmental Enforcement Section, informed the judge about the issue last week in the U.S. government’s request for the court to direct payments to the EEMC for several projects.

Judge Carter said O’Brien has notified him of ongoing talks to determine if GRT applies to EEMC projects and— if so — to calculate the appropriate payment mechanism.

Judge Carter declined to authorize GRT payments at this time, but reserves the future right to do so.

In his order, the judge also authorized payment for personnel time and hourly charges associated with the GRT issue, adding that he reserves the right to seek future credit for these payments from the EEMC.

The U.S. government’s request for payment describes these GRT charges as not significant and has asked the court to approve the invoiced amount.

Gilbane Federal’s term as the EEMC has been extended up to February 2021 upon the U.S. government’s and CUC’s requests.

In Nov. 2008, the U.S. Department of Justice and the U.S. Environmental Protection Agency signed two stipulated orders in federal court to bring into compliance CUC’s wastewater plants and collection systems, public drinking water systems, five power plants and an oil transfer pipeline.

Since then, CUC has been trying to comply with the stipulated orders with funding and technical assistance from the U.S. government.