ASPA CEO says maintenance, not rates, are affected by ASG’s debt
The Executive Director of the American Samoa Power Authority (ASPA) Utu Abe Malae assures the public that ASPA rates are not and will not be affected at all by the government’s debt.
Currently, the American Samoa Government owes the semi-autonomous agency about $9.2 million “plus current amounts” and the debt covers a period of about two years.
Utu was responding to Samoa News inquiries about whether or not ASPA rates will increase or decrease due to ASG’s debt.
He said the utility rates are not affected by the government’s debt but instead, the rates “go up or down depending on the cost of diesel fuel each month, which affects the fuel surcharge.”
However, the ASPA executive director said: ”The effect of the ASG debt not being paid is felt by ASPA maintenance. Deferring maintenance is not a good thing for a utility because it can result in expensive failures.”
Earlier this year in the Fono, senators had asked Utu to “forgive” the government’s debt and when asked if this was even an option for ASPA, Utu simply replied, “the offer still remains… If Treasury is able to pay off the old two-year debt, ASPA will rebate $3.6 million to all customers.”
According to Utu, ASG is “making steady payments and keeping the accounts as current as possible.” In fact, he added, “the old debt used to be higher than $9.2 million.”
With regards to concerns from local residents that residential and commercial clients will “absorb” some of ASG’s debt, Utu said “no” and added they are not implementing any new collection methods.
“Treasury has been able to reduce the debt by over $600,000 from a year ago,” he pointed out.
Utu explained that as far as monthly payments are concerned, the grant funded portion is paid first, and the locally funded portion is paid afterwards. “This is about $350,000 - $400,000” he reported, adding that ”ASG is also becoming more conservative in their consumption of electricity and water… and we are trying out debit meters at a few places too.”
Samoa News asked the ASPA Executive Director what he would recommend as a way to get the debt paid down faster, and in full. Utu’s response: For ASG “to collect aggressively on taxes owed or should be owed. I see that the higher tax revenues projected for the 2014 ASG budget takes the extra collection effort into account. Malo lava!”
Utu was also asked how the debt had accumulated and gotten to where it’s at today. He said that from what he can see in the financial reports, ASG was short of revenue at the time.