Gov. Eloy S. Inos signed into law yesterday a revenue-generating bill allowing the operation of video lottery in the CNMI, even as lawmakers are also weighing two other gaming measures that legalize casino gaming on Saipan and allow electronic gaming at certain hotels.
The governor also signed yesterday a new law allowing certain defined contribution plan members to withdraw their contributions without quitting their job.
Under the newly-signed Public Law 18-20, video lottery terminals are strictly limited to golf resorts, hotels that have at least 100 rooms, or at any airport departure area that is accessible to departing passengers only.
Inos earlier asked lawmakers to consider video lottery legislation that could be used for debt service for an up to $300 million pension obligation bond. That was the same day the governor signed the authorization bill for the POB.
Video lottery is run by the government with significant controls on all aspects of gaming activity to accomplish specific government objectives such as economic development, integrity in gaming and tourism development, the administration said.
Rep. Antonio Agulto (Ind-Saipan), author of House Bill 18-100, House Draft 3 that became PL 18-20, said video lottery provides a proper structure for the limited expansion of gaming on Saipan.
“I am glad that we have a new revenue-generating law so that more money will be put into the Retirement Fund, scholarship programs, and other government services. We need more revenue-generating bills,” Agulto told Saipan Tribune yesterday.
Agulto, a freshman lawmaker, pointed out that this gaming activity will be under the direct oversight of the Office of the Attorney General and the departments of Finance, Public Safety, and Commerce “to ensure maintenance of proper standards and establishment of integrity in the operations.”
He said it is important that any expansion of gaming be done carefully in recognition of the negative social impacts of this industry.
“Thus, gaming should be strictly controlled to ensure that it is directed at tourism and in a manner that promotes further development of our hotel sector,” Agulto said.
PL 18-20 amends PL 3-60 that authorized the operation of a public lottery in the CNMI but failed to conceive and account for the growing economic impact of advancement in Internet technology in recent years. This advancement includes enhancement in accountability and transparency that leads to more responsible lottery gaming activities.
The government will still have to promulgate implementing regulations based on the new video lottery law.
The governor’s signing of House Bill 18-46, House Draft 1, Senate Draft 1 into Public Law 18-21 paves the way for certain government employees to be able to withdraw their defined contribution plan account balance without being required to terminate their employment.
Only those who have been contributing to the DC plan for at least two years are eligible to withdraw their member’s account 60 days after termination of employment or giving notice of election to receive distribution of the member’s account.
The amount eligible for withdrawal includes the member’s contribution, vested portion of the government contribution, and account earnings.
If the amounts withdrawn are not rolled over into a 401k or other approved retirement account, the member will be required to pay Chapter 7 income tax, Chapter 2 earnings tax and may be subject to a 10 percent penalty.
Amounts withdrawn for “hardship reasons” such as medical care, purchase of a principal residence, or college education are not subject to a penalty.
A DC member working as a nurse at the Commonwealth Healthcare Corp., for example, said that an urgent family need compels him to consider withdrawing half of his DC contribution without quitting his job.
There are close to 1,000 government employees who opted to move to the DC plan.
Public Law 17-82 made membership in the DC plan voluntary. However, there was no provision made for withdrawal of the DC member’s account prior to termination of employment.
The same law allowed only defined benefit plan members to withdraw their contributions.