April 1, 2006 – V.I. residents who have been complaining about their electric bills may have sympathy with Juan F. Luis Hospital. The hospital's Levelized Energy Adjustment Clause portion of its V.I. Water and Power Authority bill in December was $139,000. This was up from $95,000 the previous year.
The rise in LEAC charges prompted a letter in February from hospital CEO Gregory Calliste to WAPA's executive director, Alberto Bruno-Vega.
Calliste said the hospital has constantly been cutting its power usage but its bill keeps going up.
"JLH has an outstanding debt to WAPA of about $4 million," Calliste said. "We have been making a sincere effort to reduce utility consumption, pay our current bills and pay down the debt in accordance with the memorandum of agreement."
"However, it is almost impossible to accomplish these objectives because of the huge monthly bills, which represent mainly LEAC charges, that are continually increasing," Calliste said.
He then asked if the hospital could negotiate smaller utility bills.
On March 2, Nellon Bowry, chief financial officer for WAPA, responded to the letter, He said LEAC "is the means by which WAPA recovers from its customers the cost of fuel that it must burn to produce electricity. Through the LEAC, the power authority acts merely as a cash conduit collecting money from its customers and passing it (all of it) through to Hovensa."
Bowry concludes that WAPA does not have the option of negotiating the lowering of portions of the hospital bill. He also notes that the hospital has cut consumption of power and "that's the way to go."
WAPA's Governing Board members discussed the unpaid accounts of the hospital, which it now puts at over $4.7 million for power and water services dating back many years.
On March 21, the WAPA sent a Notice of Delinquency and Demand to Cure Default to the hospital indicating that the agency is unacceptably delinquent in its payments outlined in an August 2005 memorandum.
According to the WAPA, the hospital has made required monthly payments on past due amounts, but it has failed to make monthly payments on current amounts with the new debt amounting to $1.5 million. In the seven months since the memorandum was signed, the hospital has made only one payment on its regular monthly billings.
The WAPA Board directed Bruno-Vega to follow the mandates of the MOA and disconnect the hospital if accounts are not brought current within 30 days of the notice or by April 21.
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