Senate committee tables bill on utility backbilling after stakeholders press for longer rollout and clearer dispute rules

The Senate committee resumed at about 3:16 p.m. to consider House Bill 24-59 HD1, a measure that would curb backbilling by service providers and set rules for estimating and billing when meters or billing systems fail. Stakeholders including the Commonwealth Utilities Corporation and local health-care leaders urged changes to the bill’s timing and dispute procedures before any floor vote.

CUC’s representative, Councilor Ernst, told the committee the utility "is not opposed in theory" but asked for more time to implement the new rules so the costs would not fall abruptly on ratepayers. "If this liability is imposed on us, it's ... going to have a devastating financial impact on the corporation," Ernst said, arguing that immediate effect would force the purchase of new meters and additional contractors or staff. He asked for an implementation window ranging from six months to two years and urged the committee to adopt an industry-standard look-back with averaging, pointing to Guam's four-month standard.

The utility’s director, Director Watson, told senators that many meters fail in local conditions and described the costs of replacement. Watson said a current contract to replace 300 meters is about $670,000 and warned the committee that imposing the bill without funding would amount to an unfunded mandate on ratepayers. He also said targeted meter replacements and leak detection efforts have cut non-revenue water in one service area from about 78% to 7% and reduced CNMI-wide losses from roughly 70% to under 50%.

Senator Cruz and others pressed CUC on operational details such as replacement cadence and meter-reading practices; Cruz asked whether meters were being replaced on a five-year schedule and whether reads were taken manually. Watson said some reads are still recorded manually and acknowledged human error can lead to disputes that should be investigated and corrected promptly.

Health-care representatives urged the committee to treat provider billing issues separately and to recognize the administrative differences in medical billing. Dr. Habner told the committee that Medicaid claims in the CNMI are largely a manual process and said that local reimbursement rates for complex care are markedly lower than U.S. mainland averages. "Medicaid is a manual process," she said, adding that accurate billing systems, internal controls and acceptable reimbursement levels are essential for clinics to remain financially viable.

Members discussed several specific clarifications: ensuring a backbilling dispute does not block enforcement of unrelated service bills (for example, a customer disputing a water charge should still be required to pay a separate power bill), explicitly adding meter malfunctions to the bill’s definition of "system failure," and setting a reasonable look-back period. Councilor Ernst and others recommended a four-month look-back with averaging; the Chair said the committee will consider 3–6 months or mirror Guam's practice.

After stakeholder testimony and member discussion, Senator Cruz moved to table House Bill 24-59 HD1 so the committee can draft targeted amendments on implementation timelines, dispute procedures, and definitions. The motion was seconded, carried by voice vote, and the committee adjourned at 4:21 p.m. The bill will be returned to committee for amendment drafting before a final recommendation to the full Senate.

Votes at a glance: The committee took a voice vote to table House Bill 24-59 HD1; the motion was offered by Senator Cruz and was seconded (second not recorded by name). The motion carried by voice vote.