Teno clears way for $50-M CIP projects

About $50.8 million will be spent by the government to undertake various capital improvement projects on the islands of Saipan, Tinian and Rota in what officials hope will help spur economic activities amid continuous downturn of the local tourism industry.

Gov. Pedro P. Tenorio has finally approved a measure appropriating the $30 million loan secured by the government from Bank of Guam under the interim financing scheme prior to floating municipal bonds worth $60 million.

From this amount, $20.8 million will be set aside to match federal construction grants provided under the Covenant 702/CIP financial assistance, for a total of $41.6 million in available funds that will be used to build the new prison, utilities, roads and other public structures.

The rest of the money amounting to $9.2 million will be allocated to ongoing projects which have yet to be completed due to funding shortfall, according to the bill offered by Rep. Heinz S. Hofschneider.

Signed into Public Law 11-119, the administration-backed measure was one of the slew of legislation passed during the last days of the 11th Legislature and was nearly rejected by the Senate following questions on the share given to Rota and Tinian.

Under the new law, Saipan will receive $31.2 million, while Rota and Tinian will each get $5.2 million to finance their CIP requirements. Close to $7 million will also be set aside for the third district to finish ongoing projects, while the two smaller islands will share equally more than $2.2 million for the same purpose.

“This legislation will enable the appropriate agencies to commence with $41.6 million of vitally important capital improvement projects,” said Mr. Tenorio in signing House Bill 11-496.

“These new CIP projects will help stimulate additional economic activity in the Commonwealth,” added the governor.

Among the projects planned for Saipan include $10 million for the new adult prison, juvenile detention and immigration facility; $10 million for Kagman homestead wastewater system; $3.5 million for expansion of the Commonwealth Health Center; $2 million for Kagman booster station and one million gallon reservoir; and $2 million
for Garapan tourist district revitalization.

For Tinian, $3.32 million will go to road and drainage improvement in Carolinas Heights; $970,000 for purchase of high-rise fire engine and rescue equipment; and $910,000 for Carolinas homestead water distribution system.

On Rota, $1.9 million will be spent for airport runway sealant; $1.1 million for the new Man’ Amko center in Sinapalo; $1 million for a new public library in Tatachog; and $1.2 million for a courthouse in the same area.

The third of CIP appropriations passed last year, the measure was part of the financing scheme by which the loan will be repaid through the proceeds of the bond sale amounting to $60 million underwritten by investment firm Paine Webber. The Commonwealth Development Authority is currently finalizing the bond flotation.

The island government is banking on the Covenant funds granted between 1996-2002 to steer its slumping economy, but it has met difficulties in meeting the matching requirement. The seven-year program has total funds of $154 million, including matching local money.

About $77 million will be made available by the federal government in the CIP program and so far CNMI has raised over $58 million to match the grants from local resources and the bank loan.