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Special committee examines Covid-19 contracts

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THE House Special Committee on Federal Assistance and Disaster Related Funding conducted a hearing on CNMI Homeland Security and Emergency Management duties and responsibilities as they pertain to the Covid-19 emergency and response.

Chaired by Rep. Ralph N. Yumul, the special committee is composed of House Floor Leader John Paul P. Sablan, Reps. Luis John DLG Castro, Joseph Leepan Guerrero, and Tina Sablan.

Non-members who were also present for this hearing were House Minority Leader Edwin Propst and Reps. Jose Itibus and Edmund Villagomez.

Representing HSEM were Special Assistant Gerald J. Deleon Guerrero — who was placed under oath for his testimony — and HSEM finance chief Vivian Hocog.

Also present in the gallery were representatives from the executive branch, including the governor's authorized representative Patrick Guerrero, the Governor's Covid-19 Task Force chairman Warren Villagomez, and Press Secretary Kevin Bautista.

 

Homeland Security and Emergency Management Special Assistant Gerald J. Deleon Guerrero appears before the House Special Committee on Federal Assistance and Disaster Related Funding during a hearing in the House Chamber on Monday. Photo by K-Andrea Evarose S. Limol

 

Prior to hearing testimony, Rep. Ralph N. Yumul gave a brief history of the formation of the special committee, noting that it all began in 2019 when the House of Representatives gave the administration 100% reprogram authority.

“We [also] allowed the administration to receive a loan from [the Marianas Public Land Trust] to cover extraordinary expenses related to Super Typhoon Yutu and so forth,” he said.

He noted that the Saipan and Northern Islands Legislative Delegation, for its part, “handed over well over $90 million to cover government obligations from Super Typhoon Yutu.”

“Now, we are in the process of participating in [the] Community Disaster Loan of up to $93 million. So, part of the agreement was to form this special committee to monitor, ask questions, and in the end, report to the people of the CNMI,” he said.

“Earlier this year, we received additional funds from the federal government, $36 million under Covid-19 pandemic…[through the Federal Emergency Management Agency], and I believe over $54 million was obligated within the general fund. We are here now to ask some questions and air out our concerns.”

Contracts

Among the items in question were the procurement process, specifically in regards to contracts awarded to vendors who may have contributed to the governor’s campaign during previous elections, as well as sole-source contracts with foreign vendors who, administration critics say, have no known specialty in medical equipment or supplies.

Special Assistant Deleon Guerrero said he was unaware of any personal affiliations that the contractors might have with the administration.

He said although he signed the contracts, he was not directly involved in the contract negotiations. He referred the questions to the governor’s authorized representative and the  Covid-19 task force chairman for further clarification.

He said  the contracts went through the normal Incident Command System procurement process, and generally rotated among vendors every two weeks at most.

However, contracts for OMG and Legends BBQ were longer than two weeks, from March of this year to the present date.

The special assistant said these vendors “meet the requirements,” and explained that there have been no complaints about services rendered by these particular vendors, and so their services have been retained.

He said he is not aware of any principal involved with OMG and Legends BBQ other than Kent Kalen.

When asked who picks up the checks for OMG and Legends BBQ, the special assistant said it is either Kalen or Geri Dela Cruz.

Deleon Guerrero said he was unaware of the actual role of Dela Cruz in OMG and Legends BBQ, but he believes he  is a representative of Kalen.

Rep. Tina Sablan said Dela Cruz has signed on contracts on behalf of the vendor.

She also said that the governor’s Chief of Staff Angel Demapan has picked up checks for OMG and Legends BBQ on multiple occasions.

Variety was unable to get a comment from Dela Cruz or Demapan.

Deleon Guerrero said he only recalled one instance in which Demapan had done so, and noted that there was only verbal — not written — authorization given to the CNMI Emergency Operations Center, or EOC, Filing or Log Section to allow Dela Cruz and Demapan to pick up checks on Kalen’s behalf.

As for the procurement of PPE and medical equipment or supplies, House Minority Leader Edwin Propst said two containers filled with these items “have been sitting at the dock for over one month now.”

Deleon Guerrero explained that these items are still waiting for clearances from the Division of Customs and another agent.

Propst said some items procured from foreign vendors included toilet paper, which, he added, could have been sourced locally, even in bulk.

He said the government should source locally first, then look outside of the CNMI for resources.

“I believe that the intent here was to purchase in bulk,” Deleon Guerrero said.

Rep. Jose Itibus asked about delayed vendor payments. He said a number of vendors have yet to receive payment for services rendered while others have already been paid.

Deleon Guerrero said he will look into the matter further, adding that payments are usually made to vendors within two to three weeks.

Reps. LJ Castro and Leepan Guerrero asked about  payments made to Surfrider Resort Hotel and Hyatt Regency Saipan.

Special Assistant Deleon Guerrero said Surfrider has been utilized as lodging for HSEM finance chief  Vivian Hocog who flies in from Rota to assist with the Covid-19 emergency and response on Saipan.

He said prior to the pandemic, Hocog lodged at a hotel in Garapan, until the facility closed down, which forced Hocog to seek lodging elsewhere.

As for Hyatt Regency Saipan, it is currently housing a group of lab technicians from South Korea who are assisting the Commonwealth Healthcare Corporation laboratory, Deleon Guerrero said.

Rep. Leepan Guerrero said it would have been more cost-efficient to house the South Korean lab technicians at Surfrider, but Special Assistant Deleon Guerrero explained that lodging the lab technicians at the Hyatt Regency Saipan is more ideal because the hotel is near CHCC.

Rep. Leepan Guerrero then asked why Hocog was housed at Surfrider and not at the Hyatt.

In response, the special assistant said that the Hyatt does not provide laundry services that Hocog needs.

Variety was told laundry services are offered to guests at the Hyatt.

When asked by Rep. Tina Sablan about the cancellation of services provided by Galaxy, a local meal vendor, Special Assistant Deleon Guerrero said: “There is no binding contract with this vendor.”

Northern Islands promotional trip

As for the governor’s promotional trip to the Northern Islands, Rep. Tina Sablan asked why HSEM provided supplies for the trip.

Special Assistant Deleon Guerrero said the governor had requested the support of HSEM, including providing two units of portable generators and fuel containers.

“My intention was to support the governor for the request that he asked the office for,” Deleon Guerrero said, adding that HSEM was involved in this trip “for the governor’s safety.”

He said an HSEM staff member, Roland Cruz, was directed to deliver the supplies for this trip, adding that there is a log sheet that can be used as justification for these supplies.

Deleon Guerrero said he is unsure whether or not the generators are federally funded, but he will verify it at a later date.

When asked by Rep. Sablan if the trip had anything to do with the Commonwealth response to Covid-19, the special assistant said, “I don’t think so.” 

Rep. Tina Sablan then mentioned the enabling statute for HSEM, which spells out its duties and responsibilities.

“It’s not clearly stated, but [because the governor is the] head of state, I believe that I have that duty to provide him [with these supplies].... I report to the governor,” said Special Assistant Deleon Guerrero.

“You would agree that there was no chemical [or] biological explosives, or nuclear, or pandemic, or other emergency or disaster that required the use of Homeland Security resources for this trip?” Rep. Sablan asked.

“Yes,” said Special Assistant Deleon Guerrero.

Following this response, Rep. Yumul said the special committee would go on recess until  later in afternoon for the testimony of the governor’s authorized representative,  Patrick Guerrero, in relation to the Covid-19 emergency and response.

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