St. Maarten Private Eye

From SXM News Network

Philipsburg:- The island council meeting that was called yesterday to deal with the water production contract which the Executive Council wants to give to a new company Air Fin, must be discussed in a follow up meeting in the Central Committee. That decision came after the commissioner responsible for Public Works made a long presentation of the entire contract, at the island council meeting which lasted under two hours yestreday afternoon.

National Alliance leader William Marlin after hearing and receiving a vast quantity of information requested that the discussion continues in a Central Committee meeting later this week; after which the matter must be brought back to the floor of the island council for further discussion. The motion was second by the island senator Maria Buncamper Molanus who said that the central committee meeting can take place latest Thursday this week.

Meanwhile, chairman of the Island Council Franklin Richards said he did not have a problem in granting the request but said he can only set the day and date for this meeting after Commissioner Marlin makes contact with him.
The meeting was adjourned after all parties agreed to further discuss the matter which has been the focus of the media these past weeks as the new director of GEBE is not in favor of granting any contract to any private party but instead GEBE.

Commissioner Roy Marlin said he does not have a stake in any deal with Air Fin and said that Enerserve did not live up what they need to do over the past years to upgrade water production on St. Maarten. Marlin stressed that the Executive Council played a straight game with the bidding process and they followed all recommendations given by consultant Hubert Lopez made in his tender-evaluation report. “There was no hanky-panky from our side."Marlin said. The evaluation provided the executive council with an overall scoring for the bids of all four companies. That score was presented to the Executive Council and due process was followed. "I want to make clear that I have no stake in any of these companies.”

After the evaluation was complete ExCo received a letter from Enerserve on June 30, 2006 Marlin told the Island Council. That letter Enerserve stated it was “anxious to continue serving the island and that new developments in reverse-osmosis technology opened the door for greater efficiency. Enerserve proposed a new price for a 10-year contract, miraculously one dollar-cent under the $1.33 Air-Fin bid. “They told us that after the bidding process was complete, after we had all bids evaluated,” Marlin said.

He dismissed Enerserve’s offer to upgrade the existing plant at no cost. “The cost for upgrade and maintenance of the plant is part of the price we pay for the water. That upgrade should have taken place a long time ago.” Marlin stressed. Marlin said that outsourcing water production is a trend that benefits the consumer. “We took a conscious decision in 1997 to do that and to leave the water-distribution to GEBE. The cost of water went down by 50 percent. The water company shows an operational profit.”

GEBE was not asked to put in a bid for the water production because the ExCo wants to strengthen the company’s role as distributor and as a quality watchdog. That is necessary, said Marlin, because the most recent inspection of the water plant brought to light that it needed an upgrade. “And I do not believe Enerserve’s statement that this will be done free of charge. Nothing is free of charge, the company will use money the government has already paid.”

Enerserve, first bid ($1.51) “unreasonable high”the commissioner said. He wondered why Enerserve had not managed to come up with the lowest bid. “They had all the advantages, but maybe they did not take government seriously. "If reverse-osmosis technology had become so much cheaper as they later claimed, why did they not give some of that advantage back to our community?" hea asked. Government he said entered into a bidding process because it needed more capacity, not because it wanted to get rid of Enerserve. After evaluation of all bids, government went with the bid that was recommended to us.”

Marlin stressed the importance of water for the island. “I do not want to play games with the new water contract. We have learned to live without electricity after hurricanes Luis and Lenny. We got used to candles. But we cannot live without water.” Marlin said he wished for clarity to enable the Island Council to take an informed decision.

Marlin was very disappointed with the way Enerserve handled two breakdowns in December. “It took them almost 30 days to repair a pump; we lost close to 25 percent of our capacity and we had to purchase water from the French side.” The commissioner revealed that government has a dispute with Enerserve about the buy-out clause in the present water contract. Basically, the buy-out value decreases every year. Enerserve holds that the buy-out value drops to the next level when a complete year has gone by; the government argues that the value drops within that year on a month-to-month basis.

Marlin said that GEBE must concentrate on its role as producer of electricity. “GEBE has to purchase 24 Megawatt replacement capacity for $30 million, but it has already $25 million in loans from Pacific Life.” GEBE will probably have to use part of its cash flow to finance new investments.
Marlin said that electricity-production is GEBE’s core-business. Next to that, the company must tackle leakage in the water distribution-system. “We must use operational profits for a leak reduction-plan.”