Sen. Maria T. Pangelinan, D-Saipan, said Senate Bill 16-61, which now heads to the House of Representatives, will clarify the ambiguity surrounding a certain subsection in the law that created CPUC and empowered it to set power rates.
“However, the Legislature in enacting Public Laws 15-35 and 15-40, intended that the CUC increased rates, which sought to address a perilous shortfall in CUC’s ability to pay for fuel and related costs of operations, would be retroactively recognized and retroactively effective,” she said in the findings of her bill.
The amendment states in part “the Commonwealth Utilities Corp.’s executive director’s power and authority to set rates, fees, charges and rents shall take effect on January 27, 2006 and continue until such time as the Public Utilities Commission shall issue an order setting rates, fees, charges or rents for a utility service.”
S.B. 16-61 was proposed after Rep. Stanley T. Torres won his lawsuit against CUC challenging the legality of fuel surcharge set from July 22 to Oct. 24, 2006.
The Supreme Court said although the CNMI Constitution empowers the governor to reorganize the executive branch, it does not allow him to create a new entity, agency or department as this is solely vested in the Legislature.
“By attempting to re-establish CUC after it had been consolidated within the DPW, the governor created a new Executive Branch entity, thereby, usurping the authority of the Legislative Branch. Because the executive order establishing the new entity was constitutionally defective, the resultant increased utility fee schedules were also defective,” the justices said in their slip opinion.
The government eventually cured this problem by enacting a new law as amended by P. L. 15-40 establishing CPUC, a body mandated to oversee all telecommunications and utilities industries, the justices said CUC was still operating as an illegitimate entity in the interim.
A class action suit against CUC remains pending in the trial court.
CUC estimates it will have to pay consumers $8.7 million to cover the contested period.
