ASPA FY 2016 3rd quarter performance report: delayed projects, dropping fuel costs
While the American Samoa Power Authority is faced with delays in the completion of two of its major projects — the new Satala Power Plant and the Operation Center in Tafuna — ASPA also says in its fiscal year 2016 third quarter performance report that dropping fuel costs affected not only its revenues, but its expenses also.
The US Federal Emergency Management Agency (FEMA) funds both delayed projects.
SATALA POWER PLANT
In it’s fiscal year 2016 third quarter performance report — covering the period of Apr. 1-June 30th — ASPA says construction continues for the new Satala Power Plant, though a formal request for extension of completion has been submitted by the contractor, Louis Berger Power, thus extending the completion date of the building to July 30 and the EPC contract to Aug. 31st.
“The delayed completion... results in increased costs for ASPA due to the continued use of lower-efficient rental generators,” the report said. “Therefore, ASPA is seeking to assess liquidated damages form the contractor to off set the additional costs incurred by ASPA.
Responding to Samoa News questions, ASPA managing director Paul Young said yesterday that the contractor submitted last Thursday an updated schedule for competition. And the revised completed dates are Oct. 30th this year for the building and Jan. 26, 2017 for the EPC contract.
For ASPA’s Operation Center in Tafuna, construction is ongoing, though also faces additional delays due to several change orders being submitted to extend construction management services.
Therefore the project is now expected to be completed by Oct. 31, 2016, according to the performance report, which was sent to the governor as well as lawmakers, who are currently conducting FY 2017 budget hearings.
However, Samoa News reported early this month ASPA issued a Stop Order letter to contractor Paramount Buildings after FEMA sought clarification on several issues relating to the building’s cost and construction.
ASPA executive director Utu Abe Malae told Samoa News at the time that under the contract between ASPA and Paramount, the stop order should not exceed 60 days. And once construction resumes, the building will be completed in 2- 3 months. (See Samoa News edition Aug. 5th for details).
Responding to Samoa News questions for an update on the stop order, Young said yesterday that the stop work order continues. He said ASPA is currently working with ASG’s Office of Disaster Assistance and Petroleum Management (ODAPM) and FEMA “to lift the order and should be able to determine by the end of this week when the order will be lifted.”
According to the performance report, ASPA continued progress on all on-going projects during the third quarter and total revenues were under budget by 33.5% year-to-date due to decrease in fuel prices and unbilled grant funded projects, which directly affect revenues.
Overall expenses, it says, were favorable to the budget by 24% mainly due to lower fuel expenses. Furthermore, total net operating variance as of June 30th, is unfavorable from the budget by 7.3% at $8.3 million.
ASPA says that total year-to-date actual operating and grants revenues for the period ending June 30th is $58.09 million — which represents $39.85 million for electric division; $7.17 million for water division; $8.21 million for wastewater and solid waste at $2.84 million. The highest revenue sources come from the electric division.
Of the total year-to-date revenue, the report says, this includes $41.48 million on operating revenues and grants of $16.60 million, a total variance of $29.27 million or 33.5% under revenue projections. ASPA says this is due to some of grant funding projects not being billed yet and the continuous drop in fuel prices.
For year-to-date expenses as of June 30th, the ASPA report shows a total of $66.40 million with $44.49 million spend on operations and $21.90 million on grant projects. Of the total expenses, electric had the highest at $47.16 million (71%); water at $7.30 million (11%); wastewater $8.72 million (13%) and solid waste $3.30 million (5%), a total variance of $20.96 million or 24% under budgeted expense projections and this is due to low fuel price.
For total operation expenses, $10.09 million went to personnel costs; $20.35 million for materials and supplies; travel at 162,424; contractual services $28.18 million; equipment at $2.36 million and “all others” at $5.24 million. At the end of the third quarter, ASPA’s total workforce stood at 466 with 387 full time; 36 contract; and 43 temporary workers