VIDEO: CCU Weighs Legal Challenge to PUC Order That GWA Pay $18M to GovGuam

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Guam – A GWA bond holder has already contacted Consolidated Commission on Utilities [CCU] Chairman Simon Sanchez to express concern over last Thursday night’s decision by the Public Utilities Commission [PUC] to order GWA to pay the GovGuam General Fund $18 million dollars.

Its a sign, says CCU Chairman Simon Sanchez, that the PUC’s order places GWA at risk of violating the bond covenants on last year’s infrastructure bond. And its one of the reasons why the CCU Tuesday night considered filing legal action in Superior Court to overturn the PUC order.

In a statement to PNC News, PUC Legal Counsel Fred Horecky said that the Commission was compelled to follow the findings of the Administrative Law Judge David Mair.

“The PUC  felt it had no choice but to enforce the law [Public Law 31-45]. It clearly requires that GWA allocate certain proceeds to pay off a prior debt to GovGuam. We had no choice but to enforce the law,”  said Horecky.

P.L. 31-45 was passed last year by the Legislature authorizing an infrastructure bond for GWA. The law includes an amendment which also requires GWA to pay back some $18-million to the General Fund for money that has been coming out of the General Fund to pay a 23 year old infrastructure bond originally taken out by the old Public Utilities Agency of Guam [PUAG].

However, CCU Chairman Simon Sanchez believes that the PUC decision is wrong.

“First off the law that is saying GWA must make this payment is flawed. And we think the law is forcing GWA to do something that is illegal. Mr. Mair’s, and I guess by extension Mr. Horecky’s opinion, that the PUC was bound to force us to do this we disagree with. The PUC is not required to order a Utility to do something illegal.”

As a result, Sanchez says he expects that the CCU will approve taking the issue to court. It would be the first ever challange by the CCU of a PUC decision.

In addition to appealing to the Superior Court,  Sanchez expects the CCU will also authorize filing notice with the District Court because, they fear, the PUC order may interfere with the Federal Court’s standing order requiring millions of dollars be spent by GWA on projects to bring GWA into compliance with the Federal Clean Water Act.