Investors dilemma?

Let’s evaluate the heated question that’s been dogging the new administration: Are [new] investors being misled, soon to be unduly deprived, and were treated unfairly?

Not so.

But there are detractors. In particular a special interest group whose first order of things is to protect its membership. Their primary thrust is to keep the tax rebate in its present form rather than reduced, as proposed by newly elected Governor Fitial. They, however, still find the time to heap fault on the present administration for the overall failing economy because of the mistakes of past governors.

In focus, the Pagan imbroglio is the immediate point of reference to the above question. Ask any businessperson. Running a company is fraught with hazards. More businesses go bankrupt each year than survive. Look around you. For Pagan, three companies had the tenacity to chance development of an unknown quantity at their great expense, with no guarantee of success.

J.G. Sablan was the first to learn the hard lesson since 1993.

Back then, coming from a prominent local family and married into another, no one raised questions or made demands. It was a time of innocence. And he kept the secret of Pagan to himself. Unfortunately and collectively, he lost $7 million.

Scratch one investor.

Until the arrival of Azmar back in 2003.

They spent a pretty penny, too, and painted a glowing picture of prosperity to mine high-grade stuff called pozzolan. We talking millions of dollars? Nah, we’re talking billions. Uh-oh, mistake. Now everybody knew. Emotions ran high before greed kicked in. Downfall.

Azmar’s candid proposal opened up a sloppy can of worms: It invited emotions that didn’t exist before, challenges that could’ve been solved but weren’t, and shunted them on the sidelines for the time being. If Azmar never made the initial proposal years ago? Pagan would be today as it was before the volcano.

Scratch two investors.

Next came a trade mission sponsored by the DOI a year ago. In tow was the Bridgecreek International Corp. They linked up with J.G. Sablan, who swore to have a valid permit. Now they’re taking a pasting. Has all the elements of a bestseller or made for television movie, but that’ll come later.

So where’s the beef here?

We have to go beneath the surface of the emotions played out, and the apparent confusion among parties, and the billions of dollars of who-gets-what-cut being tossed around. The crux of this problem is:

– Did J.G. Sablan have a valid permit? Bridgecreek obviously thought so.

– Did Bridgecreek do their homework and made a careful reading of the instrument of conveyance between J.G. Sablan and the government? Apparently not, according to the cancellation notice of J.G. Sablan’s permit.

Scratch three investors.

I’ve been in the real estate arena long enough, especially in the Commonwealth, to know that subterfuge is part of the game, along with convoluted instruments of conveyance. It will bite your buns if you’re not careful. The island’s court dockets have a never-ending schedule of camouflaged transactions now come to light.

That said, there’s absolutely no basis to blame the present administration for wrenching away a defunct-by-several-years mining permit, or to accuse it of sending “bad signals to investors” and “The way we have treated Bridgecreek …” as stated by a first-term senator. If this was the case, throw out all contracts and covenants and the rule of law.

Don’t get me wrong, I am pro-development and welcome investors to our shores; the more the merrier. But in this case, J.G. Sablan did not live up to the covenants of his permit. And if it was indeed declared invalid years ago, it should’ve been yanked by the previous Babauta administration and the governing agency at the time, the now abolished Marianas Public Lands Authority.

But wasn’t.

Holani Smith
Tanapag, Saipan