by Marissa Borja, KUAM News Wednesday, January 19, 2005 E-mail this article Printable version KUAM Toolbar Web Widgets Get RSS headlines

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In an effort to move forward in securing a public/private partnership for the Guam Waterworks Authority, the Consolidated Commission on Utilities voted 3-to-1 Tuesday night for the transmittal of a proposed privatization plan to the Legislature. While GWA spokesperson Patrick Lujan says that the privatization consultant firm responsible for drafting the plan has been paid $500,000 so far for its work, it remains to be seen if the investment was worthwhile.

Said Lujan, "That has yet to be determined because also part of the meeting last night was the CCU commission members decided not to pay out the privatization consultant firm so it would be interesting to see what would be the next step in account of this."

CCU chairperson Simon Sanchez maintains that in light of the Commission's need to rely on the expertise of a group that has worked on successful and failed public/private partnerships, it is money well spent. "We invested that money on the belief that we wanted to find the best way to find a partner for GWA and after reviewing all the laws and the ways that other communities have successfully found partners, we've come up with this proposed legislation," he also said.

Sanchez says he is aware of the fate of their proposed legislation. He said, "We recognize that the legislature may prefer that the existing laws be implemented, they may have a different point of view on the type of partnership for GWA that might be different from the proposal we have on the long term operating partner, or they could just reject it entirely."

Sanchez outlined the movement of the proposed plan. "We are packaging up the materials, we are working on a transmittal letter, and then we will transmit the proposed legislation to the governor and the legislature for their consideration to introduce and pass the legislation to allow the CCU and GWA for the ability and legal authority to pursue this kind of long term partnership with a private partner," he said.

And what exactly is the CCU recommending? That GWA and the CCU find a partner that would operate the entire agency on behalf of the people of Guam and GWA. While Guam will retain its water and its system, the system would be leased over to the partner who will agree to maintain operations based on performance standards and court orders.

In the meantime, the CCU also approved a $1.8 million loan for the purchase of heavy equipment, including generators and back hoes as part of the U.S. Environmental Protection Agency's stipulated order, as well as a $2.5 million loan for working capital, which would allow GWA to pay off part of the $5 million it owes to vendors.