NMC not out of the woods yet on La Fiesta

The Northern Marianas College is asking the Governor’s Office anew for funding for the operation of the La Fiesta shopping mall, in view of the possibility that the transfer of the property would not be finalized by the end of the fiscal year.

The NMC Board of Regents yesterday tasked college president Antonio Deleon Guerrero to remind the Executive Branch that NMC has money for La Fiesta only up to Sept. 30, when FY 2004 ends.

Gov. Juan N. Babauta and the Board of Regents entered into an agreement to transfer the facility and the San Roque property it sits on from the college to the CNMI government, under the management of the Executive Branch.

In an interview, however, Guerrero said the transfer has not been finalized because both parties are still waiting for the original sellers—Hotel Nikko Saipan and Coco’s Lagoon Development Corp.—to concur with the agreement.

Guerrero said that the sellers’ representative on Saipan left for Japan to meet with Hotel Nikko and Coco’s stakeholders. The representative will not be back until Sept. 29.

“The board tasked me to remind the Governor’s Office that we don’t have the funds to operate La Fiesta after Sept. 30, and that they need to give us money to keep the facility going if the transfer does not materialize by the end of the month,” Guerrero said.

NMC needs approximately $32,000 run the mall for the month of October.

He, however, noted that NMC does not anticipate any problem about getting the sellers to approve the transfer.

“They do want to have good relationship with the CNMI government. Both parties in the agreement know that it will not be official until the sellers concur, but this is more [a] procedural [issue than anything else],” he said.

Another pending issue that NMC and the Governor’s Office have with the La Fiesta sellers is the college’s request for a 90-day extension to the deadline for a $200,000 partial lease payment.

NMC is currently scheduled to make the payment on Oct. 31. This would be extended to Dec. 31 if the sellers agree to NMC’s request.

On June 19, 2003, the Governor’s Office entered into a memorandum of agreement with NMC where $3.5 million of grant funds were committed for the acquisition of the La Fiesta facilities and the San Roque real property that the mall sits on.

Since last January, NMC has been operating the mall at a substantial loss, requiring the Governor’s Office to offset the losses to date. The funds from the Executive Branch, however, will last only until Sept. 30, when the current fiscal year ends.

NMC has asked the Legislature for additional funding for the operation of La Fiesta, but the request was disapproved. This left NMC without money to run the facility beginning Oct. 1.

On Sept. 11, the College Council, Faculty Senate, Staff Senate, and the Associated Student of NMC submitted the proposal recommending that the Board of Regents transfer ownership of the property to the CNMI government and that the Executive Branch assume management of the facility.

The Board of Regents adopted the recommendation. The memorandum of agreement was executed on Sept. 15.