The government stiffs CUC, again
AS a 2017 OPA report would put it, CUC was mandated to operate as an independent, businesslike corporation, but is continually subjected to political interference by the Legislature and/or whoever the governor is.
It is highly doubtful that an independent, businesslike corporation would have agreed to magically wave away the central government’s utility arrears in exchange for writing off a 1% fee that CUC couldn’t remit precisely because the government wasn’t paying its utility bills on time or at all.
What would OPA say about this latest episode of executive branch meddling? Wait. Has the governor appointed a new public auditor yet? The last one resigned in May 2022.
In any case, the $10.9 million that was “offset” by the MOA between the administration and CUC represents the actual consumption of utility services that cost CUC a lot of money to produce. In return, CUC is no longer required to pay what a piece of paper says CUC ought to pay.
“Win-win,” says the administration. It is. For the governor and his legislative allies. Now they don’t have to figure out how to pay CUC — in the next few months or so.
Meanwhile, CHCC and other government entities still owe CUC millions and millions of dollars in unpaid utility bills. Meanwhile, the government continues to consume power and other utility services as if these were free. Anyone can go to any government office and know immediately how it can conserve power. Has a government-wide power conservation plan been implemented, with specific goals and ongoing monitoring? If not, why not?
Another temporary relief
THE federal government has allocated $27.1 million in CNMI Medicaid funding to address the shortfall in fiscal years 2023 and 2024. Thank you President Biden, U.S. Congress, Congressman Kilili and federal taxpayers.
However, as CHCC has pointed out, this is “temporary relief.” CNMI patients will continue to avail themselves of healthcare services that should be funded by their government, which is still cash-strapped. While we wait for yet another demonstration of federal generosity — such as the elimination of the Medicaid cap for U.S. territories — what happens next? The CNMI government still needs to generate more actual funds, rather than relying on the wishful revenue projected by tax-hike proposals. That requires reviving the tourism-based economy. Almost two years after this new leadership was sworn in, how’s that going so far?
Not so good
VISITOR arrivals are still down, and HANMI’s occupancy rate was 44.6% in August. (HANMI says hotels typically require around 70-80% hotel occupancy to stay in operation.) The CNMI remains highly dependent on Korean arrivals, which, sadly, are not enough. The governor continues to hope that the Japan market will become what it used to be — a major source of tourists — but Japanese arrivals in August totaled 800 only compared to 960 in August 2023.
In a recent NAVFAC Industry Day event, the governor said businesses should “do their part.” But what about his administration? Besides doubling down on his pivot mantra, what else is the governor doing to help the local tourism recover and prevent more businesses from downsizing or shutting down?
In two years, he said, things will get better. How does he know?
Meanwhile, his “solution” to this bloated government’s overspending ways is to raise taxes — even though he himself called them “penalties” imposed by a government that misspent public funds.
The government, in any case, is now functioning in an ad hoc manner, scrambling to address the most urgent needs as they emerge.
It’s going to be a long two years.
