Ending a disastrous period of uncontrolled government spending and finally enacting a budget to match estimated resources will probably be the single most important accomplishment of the 16th Legislature for Fiscal Year 2009.  

 

Granted, it happened late — six months into the fiscal year — and in the House it took several override attempts, particularly after members who had originally voted yes to the budget suddenly changed their minds, but the budget veto override was finally achieved at the March 11 session with the required minimum of 14 votes.  The members who ultimately voted yes to the override were: Reps. Edwin Aldan, Dave Apatang, Diego Benavente, Frank Dela Cruz, Joseph Deleon Guerrero, Heinz Hofschneider, Arnold Palacios, Joseph Reyes, Ed Salas, Rosemond Santos, Ray Tebuteb, Ralph Torres, Ray Yumul, and myself.  The members who voted no were: Reps. Oscar Babauta, Joseph Camacho, Vic Hocog, Stanley Torres.  Reps. Justo Quitugua and Ray Palacios were absent.  

 

As expected, the administration's response to the override has been to threaten massive layoffs and even the shutdown of the government, claiming that such actions would be the inevitable result of the legislature's enactment of the budget — but conveniently refraining from any explanation of how layoffs and government shutdown could have been averted in the absence of a budget.  Also predictably, the administration continues to insist on the reinstatement of austerity measures — measures that badly failed in the past, and were used to accommodate continued government hiring and other questionable expenditures. 

 

The governor's reactions to the enactment of this budget underscore the gross fiscal irresponsibility, mismanagement, and illogic of his administration.  That he would rather have no budget at all signals a disturbing preference for the deliberate and reckless deficit spending which has brought this government to its knees.  That he would push for the reinstatement of a failed austerity policy reveals either an unwillingness to learn from the mistakes of the past and consider other cost-cutting options, including options that are already available under the Planning and Budgeting Act, should further cuts be necessary this fiscal year. 

 

As the saying goes, insanity is doing something over and over again and expecting a different result.  Let's stop the insanity.  Let's focus instead on compliance with the law, following the FY 2009 budget that was just enacted, and following the Planning and Budgeting Act.  Let's also focus on the budget for FY 2010, and learn from the mistakes of this past budget process, and the failures of past policies.

 

           

 

A) Zoning Board Members Confirmed by Legislative Inaction – One of the major reasons for this SNILD session was to confirm the reappointments of four Zoning Board Members: Mr. Henry Hofschneider, Mr. Isidoro Cabrera, Ms. Herminia Fusco, and Ms. Liz Rechebei, whose nomination periods were purportedly expiring on the day of the session, and so a sense of urgency in acting on their nominations that day was impressed upon the members.  Not all of the required documents for one of the nominees was submitted by that day, however, and some members objected to the motion to confirm that nominee on those grounds.  My primary objections included the lack of a formal committee report or even a prior confirmation hearing so that SNILD members and the community could have the opportunity to examine the records, performance, and future plans of the reappointed members.  

 

The chairman then called for a recess and the legal counsel checked the statutory requirements for the confirmation of Zoning Board members.  It was at that point that we discovered, rather embarrassingly so, that the Zoning code provides that board appointees are considered automatically confirmed within 30 days of their appointment unless the Saipan delegation acts otherwise.  The motion to confirm the Zoning Board members was then withdrawn because it was apparently moot (the 30 days had already lapsed), and we moved on to other items on the agenda. 

 

 

B) House Local Bill 16-22, D1 passed in the SNILD – Sponsored by Reps. Justo Quitugua, Ray Palacios, and Dave Apatang, this bill proposes to make SHEFA scholarships also available to students of the Third Senatorial District who are simultaneously enrolled in a high school or high school equivalency program and a trade school in the CNMI or outside the CNMI.  SHEFA scholarships are currently only available to students who have obtained a high school or a high school equivalency diploma. 

 

The bill also amends the terms for SHEFA board members, clarifying that a board member's term shall expire unless reappointed and confirmed pursuant to the statute.  Currently, board members are allowed to hold office virtually indefinitely, until successors have been appointed and confirmed.     

 

All 16 members present voted yes, myself included.  Five members were absent: Reps Heinz Hofschneider, Ed Salas, Ralph Torres, Ray Yumul, and Dave Apatang.   

 

 

C) HLB 16-3, S1 – introduced by Reps. Justo Quitugua, Joseph Camacho, Ray Tebuteb, Oscar Babauta, and Dave Apatang, this bill proposed to appropriate approximately $30,000 for the FIBA Oceania Basketball Tournament scheduled for June 2009; approximately $10,000 for the Micronesian Youth Services Network Conference on March 30-Apr 1, 2009; $9,000 for unpaid landscaping services rendered by Tropical Gardens for the Dept of Public Works; $50,581 for the construction of an outdoor stage for Kagman Elementary School; and $13,000 from the Saipan Trust Fund to print the Directory of Traditional Healers and Medicinal Plants in the CNMI.  

 

This substitute bill was introduced and passed on the day of the SNILD session, and was completely different from the original bill.  I raised objections about the lack of ample time and opportunity to study the bill, review the various funds that were being affected by these new appropriations, and also review the new projects that would now be receiving the funds.  The local delegations are infamous for constant appropriations and reappropriations of the same dwindling funding sources, with no real plan reflecting the priorities of each senatorial district, and with projects often losing funding before they are completed — sometimes even before they start.  This bill certainly epitomized those problems. 

 

I also objected to the practice of introducing and ultimately voting on local bills that are completely different from the original bills that went through the required process of being laid on the table for three days in the House before being referred to the local delegations for action.  The whole-cloth substitution of local bills in sessions of the delegation circumvents the three-day rule.  Rep. Diego Benavente then followed up on my comments with a request for a legal opinion on how much the local delegation could amend or substitute a bill without violating the three-day rule.     

 

Fourteen members present voted yes to this bill; Sen. Luis Crisostimo and I voted no.  Five members were absent: Reps. Heinz Hofschneider, Ed Salas, Ralph Torres, and Ray Yumul were absent.

 

D) HLB 16-26 referred to the SNILD Committee on Judiciary and Governmental Operations for review – The bill proposes to establish the Unarmed Combat Sport, and to establish the Athletic Commission. (Rep. Stanley Torres)

 

 

 

 

B) House Joint Resolution 16-25 adopted – congratulating Asiana Airlines for being selected as the Airline of the Year for 2009 by Penton Media's Air Transport World, and expressing appreciation for Asiana Airlines' continued commitment and support of the CNMI's travel industry. 

 

C) House Resolution 16-77 adopted — recognizing and commending the Marianas Public Land Trust and its Trustees for their proactive efforts in assisting borrowers in its MPLT Home Loan Portfolio, as an economically targeted investment, in passing MPLT Resolution 09-01 affording debt relief to the borrowers in the program. 

 

Not long before this resolution was introduced by Rep. Vic Hocog, a meeting had been held with the Northern Marianas Housing Corporation and the House Committee on Commerce and Tourism to discuss the CNMI's housing crisis and potential options to afford relief to borrowers and avert default with the USDA Rural Development program.  The MPLT Home Loan program that is the subject of HR 16-77 used to be administered by NMHC, and came up for discussion during that meeting, as NMHC is still struggling with the financial consequences of having had to abruptly return those loan portfolios back to MPLT by law.  Decisions made or not made by MPLT (and the Legislature) with respect to the home lending program years ago may have contributed to the housing crisis today, and so I felt it was premature to commend MPLT without having more information and a clearer picture of the history of the home lending program.  I requested that the Special Committee on Housing be tasked with reviewing the resolution and researching the history behind that program, but my request was denied by the majority and the resolution was adopted. 

 

I voted no. 

   

D) House Bill 16-179, HD1 passed by the House - Introduced by Rep. Rosemond Santos, this bill proposes to amend and repeal certain sections of Public Law 15-46, the Probation Reform Act of 2006, that are duplicative, and to require that probation fees must apply to anyone placed on probation.  Current statute allows probation fees to be waived for offenders determined to be indigent using the Public Defender's elibility criteria; the Committee on Judiciary and Governmental Operations recommended that indigent defendants' right to free counsel through the Public Defender's Office should be distinguished from probation reform proceedings.  According to the committee report, probation is a privilege and not a right, and probation fees should apply to anyone placed on probation.  Fees shall continue to be determined by the Court, and shall not be less than $20 nor more than $360 annually (the fee ceiling would be raised from $100 and would be comparable to the current CNMI Parole fee requirements), depending on the nature of the offense, the level of supervision, and the investigation required.  The bill was developed in collaboration with the Office of Adult Probation. 

 

All 17 members present voted yes, myself included.  Three members were absent: Reps. Ray Palacios, Justo Quitugua, and Ray Yumul.        

 

 

G) Standing Committee Report 16-72 referred back to Health & Education Committee – this bill proposes to authorize the Dept of Public Safety, Fire Division to regulate private ambulance services.

 

H) Senate Bill 16-51, SD1 placed on the House calendar for action – Introduced by Sen. Pete Reyes, this bill proposes to remedy a current and untenable situation at the Office of the Attorney General, by clarifying that an individual, absent Senate confirmation, shall neither occupy nor serve in the capacity of Attorney General, Acting Attorney General, or Interim Attorney General in excess of 30 days absent nomination to the Senate nor in excess of 90 days upon nomination. 

 

 

A) Joint Session Committee Report 16-2 – recommending legislative approval of the public land lease agreement between the Department of Public Lands and Neo Goldwings Paradise Saipan Corporation d.b.a. NGP Casino and Hotel.  ADOPTED by voice vote.  Sen. Luis Crisostimo and I voted no. 

 

B) Joint Session Resolution 16-3 — granting approval pursuant to Article XI, Section 5(d) of the Constitution of a lease agreement between the Department of Public Lands and Neo Gold Wings Paradise Saipan Corporation, doing business as NGP Casino and Hotel for the leasing of approximately 3,000,000 square meters of public land in Tinian, CNMI; and granting approval pursuant to Article XI, Section 5(c) of the Constitution of an extension of said lease agreement for a period of not longer than 15 years.  ADOPTED.  All members present voted yes, except for Sen. Luis Crisostimo, Rep. Stanley Torres, and myself.

 

The public land lease agreement with Neo Goldwings Paradise raises critical questions about the due diligence that is exercised (or not exercised) in the review, negotiation, and approval of public land leases to private investors.  The conceptual plans offered by the investors of NGP can only be described as grandiose: for 300 hectares (3 million square meters, or nearly 3% of the total land area of Tinian) of prime public land, NGP envisioned a $300million, six-star, 1000-room mega hotel and casino, golf course, international meeting hall, artificial ice stadium, artificial snow stadium, man-made beach, a fountain yard, a "Kursaal" project, a "fire balloon game," a helicab, a "yacht orbital way," and other facilities and amenities.  The marketing plan they submitted to the Dept of Public Lands is unfortunately a bit vague, as is their financing plan (indeed, DPL did not require NGP to show proof of financing prior to signing the lease agreement, as is required for other private entities seeking public land leases).  Moreover, NGP's corporate structure is unclear; so far I have only seen a list of "possible" directors and shareholders.  

Considering the significance of the NGP proposal, the skepticism that it would naturally elicit given the lack of financing or clear corporate structure and given global economic conditions, and the amount of public land involved, one would hope that at a minimum the CNMI Legislature would take the time to thoroughly review all pertinent documents and perhaps engage in a meaningful discussion of the proposal on the record.  But instead the joint session was announced with little more than a day's notice, copies of the final lease agreement were circulated only a day before the session, the committee report and joint resolution approving the lease were distributed just minutes before the session, and a copy of the land appraisal report was not made available for review until I asked about it during the session.  Some members, myself included, were not even aware until the day of the session that we were approving a 25 year lease as well as the 15 year extension, all in one shot, which has apparently never been done before in the history of the Commonwealth.  The lease terms for the last 15 years were also unclear in the agreement, an oversight that the legal counsels acknowledged, and about which few other members seemed particularly concerned.          

 

It is important to note that the joint session would not have been called in the first place if enough votes to approve the lease had not been secured already, which means that at least some members were ready to vote even before they had reviewed all pertinent documents.  Members were ready to vote even without much discussion on the floor — the motion to end debate and call for the vote was made and seconded without very much debate at all, and the lease was ultimately approved by the legislature.

 

During and after the session, I was urged by several colleagues to be more "trusting" — of the legislative committees, of the Department of Public Lands, of the attorney who represents NGP, and of the lease.  A few members also told me that they had felt comfortable approving the lease despite their own doubts and concerns because if the investors do not show proof of adequate financing within six months, the lease will be revoked.  The CNMI loses nothing, they said.  I disagree with that sentiment.  It is not only public land that is at stake, but also the credibility of the government, and our ability to attract legitimate, high-quality investors now and in the future when we negotiate and approve public land leases carelessly and without due diligence.     
 
What would I say, one senator asked me after the session, if the project turns out to be a huge success?  For the sake of the people of Tinian and the CNMI, I do hope that my worries turn out to be groundless.  But what would any of us say, I wonder, and what could the CNMI possibly lose, if NGP does not succeed in delivering the promises that have thus far been made — losses that perhaps could have been averted had this government shown more care and diligence?

 

 

 

A) House Commerce & Tourism Committee Meeting on Friday, March 20 @ 10am in the Speaker's Conference Room  — to review House Bill 16-210 (overhauling the Qualifying Certificate program); HB 16-177 (imposing a temporary moratorium on the Qualifying Certificate program); HB 16-172 (offering temporary abatement/rebate of taxes and fees for new investments of at least $5million);  and SB 16-45 (amending the security deposit requirement for foreign long term business permit applicants)

 

B) Presentation by Teen Talk at the Legislature on Thursday, March 26, @ 3:30pm in the House Chamber – Teen Talk is a project of the Public School System's Youth Development Program.