‘Feds presented no new arguments’

The CNMI’s lawyers will review the U.S. government’s motion to dismiss the lawsuit against federalization and will file a response by the court’s deadline, according to press secretary Charles Reyes Jr. yesterday.

Reyes said that, contrary to the arguments raised in the U.S. government’s motion, they believe that the provisions of the federalization law, Public Law 110-29, will have serious adverse consequences for the economy and citizens of the CNMI.

“We look forward to a resolution of the issues by the District Court in Washington DC,” Reyes told Saipan Tribune.

The press secretary said the federal government presented no new arguments in response to the CNMI’s lawsuit and its request to stop the implementation of the federalization law.

Citing four main arguments, the U.S. government, through the Department of Justice, asked the U.S. District Court for the District of Columbia to dismiss the CNMI’s lawsuit.

One of the arguments cited was that Gov. Benigno R. Fitial lacks standing to bring the court action on behalf of the Commonwealth.

The federalization law is set to take effect on June 1, 2009. It provides for the full implementation of federal immigration laws in the Commonwealth.

Reyes said that even before the implementation of federalization, the CNMI is already suffering its adverse economic effects, as investors suspend, curtail, or abandon planned investments as a result of the uncertainty the new law has created.

“Federalization, for example, places a maximum cap on the number of workers we can have right now and this hampers investment and economic growth, because a cap on labor is essentially a cap on the CNMI’s economic growth,” Reyes said.

The press secretary said that Fitial believes that federalization is the single biggest obstacle to a full economic recovery for the CNMI.

“Federalization means our Department of Labor and our Division of Immigration will close down, with all those government employees suffering displacement,” he said.

Reyes said federalization also means the CNMI will be losing as much as $6 million in CNMI Labor, immigration fees, and foreign investment fees under Commerce.

He pointed out that an entire section of Commerce will be closed down and the CNMI will lose substantial fee revenues at a time when the budget is already rapidly contracting.

“Federalization will severely limit our nonresident worker population and take needed workers away from businesses and industry, curtailing investment flows,” he said.

Reyes said they expect a severe GDP contraction under federalization, as mentioned in the Government Accountability Office and Conway-McPhee reports.

“Federalization also means we could lose our Chinese and Russian markets—markets worth more than $100 million for us,” he added.