“Due to cash flow issues this week…payroll and allotments will not be released until Monday 5/9,” the memorandum stated.
Warren asked division managers to notify their staff and “extend my apologies for the inconvenience.”
A CUC employee who declined to be identified said this will be the first time they will not get their salary on payday.
About 330 personnel, including those holding managerial positions, will be affected by the payroll delay.
CUC Executive Director Abe Utu Malae, in an interview, said the delay is caused by insufficient funds.
“The reason is simple. We do not have enough cash because the priority is to pay for diesel in order to run the power plants on all three islands,” he said.
CUC keeps running short of funds because the fuel prices are increasing faster than CUC is able to collect from its customers, he added.
“There is a vast chasm between the [levelized energy adjustment clause or] LEAC [rate] adjustment and when it takes effect. The six-month period for the LEAC was designed with the assumption that fuel prices vary little and that any adjustments will be acted on quickly,” he said.
According to Malae, the assumption was not based on reality.
In previous years when CUC reduced its workers hours, the results were disastrous, he said.
“More was obligated in overtime; more water pumps failed; and Saipan went dark in 2008. Remember that?” he asked.
