Lack of oversight of MPLT activities cited

The Marianas Public Lands Trust’s seeming disregard of its fiduciary duty can be traced from a lack of monitoring by the Executive Branch and Legislature of its activities, according to the Office of the Public Auditor.

OPA disclosed in a recent report that MPLT had spent nearly $300,000 for board compensation and over $500,000 for travel expenses during fiscal years 2002 to 2004.

OPA also said that the board of trustees raised their own meeting fee to $150 each for a meeting lasting four hours or less and $300 each for meetings exceeding four hours.

The CNMI law provides compensation of board members of government corporations and councils at $30 for a half day meeting and $60 for a whole day meeting.

The OPA also said that MPLT board met “significantly more often” than the 12 regular meetings a year: 50 times in 2002, 115 times in FY 2003, and 90 meetings in FY 2004.

Aside from these, MPLT board members and its executive director/independent contractor always fly business class for flights exceeding five hours.

OPA said that administrative expenses showed to be “higher than they should.”

In the report, OPA said that MPLT executive director Bruce Macmillan received over $417,000 in the three-year period in salary.

“The high expenses can be attributed to the significant increase in the number of trustees meetings, the 500-percent increase in meeting fees the trustees approved for themselves, business or first class air travel, the Executive Director’s contract, and most importantly a lack of oversight by the Executive and Legislative branches of board activities,” said Public Auditor Michael S. Sablan.

He noted that trustees have a fiduciary duty to manage the funds of the Trust “in the best interest of the people of the CNMI.”

“The issues discussed in his letter would suggest that the board may not be meeting that fiduciary duty,” he said.

In the same report, OPA said that during the period, the MPLT failed to transfer interest to the CNMI coffers.

The public auditor cited that MPLT was created to manage all monies received for the use of public lands and to use the interest on the money received from the federal government for the lease of Tanapag Harbor to develop and maintain a memorial park.

MPLT, meantime, said that the MPLT’s funds, duties and responsibilities are entirely independent and separate from the functions of the legislative staff or Executive Branch.

Further, since the Constitution does not establish a trustee compensation rate; the trustees were left to determine an appropriate rate based upon the Restatement of Trust.